Transform of Industrial Clusters' Competition Advantage

Based on the life cycle of industrial clusters, this thesis presents a research on the transform of industrial clusters' compe titive advantage. In fact, the competitive advantage of industrial clusters is enhanced with time, caused by its inner potency or outer factors. How to keep up the competitive advantage of industrial clusters to prolong the life cycle of industrial clusters has become an important question for discussion. The second chapter gives an analysis of the competitive advantage that comes from agglomeration economy . The scale of industrial clusters is based on the comparison between the centripetal force and the centrifugal force. As the scale of industrial clusters enlarges, the average cost moves in a U curve,which first comes down and then goes up. Since industrial clusters are constantly under the threat of the centrifugal force caused by the congestion costs, the competitive advantage coming from agglomeration economy is easily weakened. The third chapter demonstrates the competitive advantage based on innovative networks. Enterprises in innovative networks can achieve share assets, effect s of knowledge spill-over, collective learning, accumulation of innovation, low ris ks and costs which are essential to innovation. Since innovative networks cannot come into being spontaneously, the forth chapter discusses how to establish innovative networks based on industrial clust ers. First of all, trustful culture should be advocated. What's more, innovative networks need the support of the government and scientific research departments to promote innovation. In addition, trade union can bring about special lubricant effects. Finally, innovative networks should be open and sensitive to new inf ormation and resources, which improve the continual innovative capability of the industrial clusters.