The role of institutions for cluster development based on the regional labour force concentration
The role of institutions for cluster development based on the regional labour force concentration

Summary/Abstract: The objective of this paper is to examine the role of institutions and policy support for cluster development and competitive advantages of regions based on the regional labour force concentration. The tool of the cluster identification in regional economy - Localisation Quotient (LQ) - has been applied to measure the concentration of the labour force in main economic sectors in Latvia and Finland. This comparative analysis has shown that Finland has much stronger regional labour force concentration in certain sectors of the economy, which is not typical for Latvia, revealing that the regional economy of Latvia has much lower potential for cluster development and competitiveness in global markets as Finland. Results of this research confirm that governments should support cluster development based on naturally growth poles exploiting potential of regional comparative advantages, such as specific concentration of skills and knowledge (labour force), concentration of industries, natural resources, etc. to achieve sustainable long term development by applying cluster approach, but not concentrate on short term priorities in cluster development.

• Details
• Contents