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Learning in local cluster in the context of global value chain: A case study of the Yunhe wood toy cluster in Zhejiang, China
Yanwei Zheng
Zhejiang Administration School, Hangzhou, China
Shihao Sheng
Zhejiang Administration School, Hangzhou, China
Abstract
This paper examines learning of local cluster from external sources. It is based on the detailed case study of Yunhe wood toy cluster, Zhejiang Province, China.
Employing the theorems of global value chain and cluster learning, the paper explores on various external channels of knowledge and the role for the learning of local firms. The channels include international trade relations, FDI, expositions, and domestic knowledge centers, and the Internet.
The paper ends with a discussion on the findings on externally sourced learning and policies for promotion of learning in the cluster.
Keywords
local cluster, global value chain, learning, wood toy
Article Text
This paper discusses the learning of local clusters from external sources from examination of the wood toy cluster in Yunhe, Zhejiang Province of China.
Recently industrial clusters have received significant attention (Porter 1990, 1998; Nadvi & Schmitz 1999; UNIDO 2001; Hubert Schmitz 2003). Geographical proximity characterizes the firm-clustering phenomenon with varying degrees of vertical and horizontal specialization. The Yunhe wood toy cluster now consists of more than 400 firms, developed since its start in the 1970s.
This paper's analysis of Yunhe wood toy cluster learning follows the theorem of learning in a global value chain (GVC) (Kaplinsky & Morris 2001; Gereffi & Kaplinsky 2001; UNIDO 2003; Gereffi, Humphrey & Sturgeon 2005). In a globalizing economy, the whole process of production is often widely dispersed geographically, and producers in developing countries are generally located at the lowest end of the value chain.
Our analysis takes the stand that learning is the most important process for clusters in developing countries, if they expect to improve their situation in the value chain and to become competent in innovation and competitiveness (Lorenzen 1998; Hofmaier 2001; Bathelt, Malmberg & Maskell 2004). For the learning of local firms in the global value chain, we distinguish learning from internal cluster sources and learning from external sources. Because of limits of resources in the local milieu, learning from external sources is crucial in order to avoid becoming locked-in to the low end of production (UNIDO 2003). This paper focuses on externally sourced learning.
Section 2 presents the wood toy global value chain and the evolution of the Yunhe wood toy cluster. Section 3 probes the role of different external sources in learning at the local wood toy cluster in Yunhe. Section 4 discusses findings.
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