Cluster Development – A Systematic Literature Review, Challenges and Research Agenda

Abstract

The development of Industrial and Artisan Clusters is identified as a crucial strategy for enhancing regional competitiveness, fostering innovation, and creating more inclusive economic avenues, particularly in developing regions. Despite substantial research into the dynamics of these clusters, inconsistencies remain, mainly due to fragmented theoretical frameworks and an overemphasis on High-Tech Clusters in developed nations. This study conducts a systematic literature review that employs the PRISMA framework, assessing 61 peer-reviewed articles published from 1995 to 2024 across various industries and geographic contexts, specifically focusing on Low-Tech and Artisan Clusters. Major findings highlight significant barriers to cluster development: inadequate infrastructure, limited access to finance, weak institutional coordination, and policy inconsistencies. On the flip side, key drivers that facilitate the development and sustainability of these clusters include knowledge transfer mechanisms, innovation-supporting networks, government backing, and collaborative value creation initiatives. This review provides valuable insights for future research aimed at reinforcing Cluster Ecosystems and informing Policy Interventions, thus addressing the critical gaps in current understanding of Low-Tech and Artisan Cluster dynamics.