Evaluation of industry cluster competitiveness: a quantitative approach

The purpose of this paper is to provide a quantitative approach to measure industry clusters competitiveness.

An attempt has been made to construct a composite indicator backed up by a conceptually grounded framework, by means of Analytical Hierarchical Process technique. Four industry clusters from auto sector in India are chosen for manifestation of the methodology.

The proposed methodology sufficiently emphasises on the order of significance of the factors/indicators that make a cluster competitive. The study demonstrates the comparative competitiveness performance of four select industry clusters from India.

The methodology only focusses on auto clusters from India, application of the model/methodology needs to be extended to other set of industries that follows tier structure, or belong to other developing nations to corroborate the findings.

The proposed approach is a useful tool to provide guidance to policy-makers and in monitoring industry clusters progress.

The paper offers an empirical approach for measuring competitiveness of industry clusters. So far there has been only a minuscule research on cluster competitiveness using empirical methods specifically in case of developing countries like India. Because of the heterogeneity of actors in industry clusters and absence of cluster relevant databases, its performance has been mostly captured via means of case studies. This study is one of its kind that renders comparison of competitiveness across industry clusters by combining secondary data with the perception of cluster actors.