A model of cluster adoption : the role of transaction costs, resource characteristics, and technology.

Castner, Grant James. (2004). A model of cluster adoption : the role of transaction costs, resource characteristics, and technology. PhD Thesis, School of Business, The University of Queensland.

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Author Castner, Grant James.
Thesis Title A model of cluster adoption : the role of transaction costs, resource characteristics, and technology.
School, Centre or Institute School of Business
Institution The University of Queensland
Publication date 2004
Thesis type PhD Thesis
Supervisor Prof Ron Weber
Prof Colin Ferguson
Total pages 204
Collection year 2004
Language eng
Subjects L
280106 Interorganisational Information Systems
720403 Management
Formatted abstract This thesis examines the factors that affect the adoption of clusters by organisations. A cluster is a group of separate firms that collaborate for business purposes. These purposes include sharing resources, promoting and selling complementary products, group purchasing, and accessing global markets. Coordination of the cluster is often achieved by using information technologies such as the World Wide Web, e-mail, and intranets.

Clusters are an important government strategy to increase economic development. Government agencies attempt to provide the initial impetus for clusters to develop. These agencies base their programs on reviewing naturally occurring clusters (clusters that develop without government intervention), the advice of cluster consultants, and relevant theory (for example. Porter, 1998; Porter, 2000). The success of these government initiatives has been mixed (see Anderson (2000)). The original motivation for this thesis derives from government interest in cluster development.

The main objective of this thesis is to develop a model of cluster adoption. It builds on the theories of innovation diffusion, the resource-based view of the firm, and transaction-cost economics. There are three basic premises that drive my model. First, the cluster is an innovation for the individual firms that are considering its adoption. This assumption means that the attributes of innovations - namely, relative advantage, compatibility, complexity, visibility, result demonstrability, and trialability – are hypothesised to affect the adoption decision. Second, the relative advantage of cluster adoption depends on the cluster providing individual firms with valuable, heterogeneous, and immobile resources. These characteristics are drawn from the resource-based view of the firm. The cluster must also be the appropriate governance structure for the transaction, so the transaction-cost-economics factors of asset specificity and transaction frequency are predicted to positively affect relative advantage. Third, the adoption of information technologies is required to co-ordinate the activities of the cluster and to facilitate effective access to the additional resources that it provides.

The other major motivation for this thesis originates from the use of the theories described above. This thesis examines the inter-relationships among the factors that comprise these theories. In particular, the relationships among the diffusion factors are examined. The objective is to discover why the diffusion factors do not consistently predict innovation adoption. I also examine the interaction between transaction-cost-economics factors and factors sourced from the resource-based view of the firm. The purpose is to present a model that demonstrates how the two theories complement each other when used to determine the competitive advantage of a transaction supported by relevant resources.

The propositions were tested using a multi-method approach. Case studies and a survey provided corroborating empirical evidence. The results indicated that relative advantage has a positive effect on the extent of cluster adoption, suggesting that resource value, immobility, and heterogeneity are relevant measures of cluster relative advantage. Furthermore, relative transaction frequency and relative resource specificity were positively associated with relative advantage. The results support the conclusion that the cluster providing a better transaction governance structure is antecedent to relative advantage.

The remaining results were mixed. Examining the survey results, they supported the negative relationship between complexity and relative advantage. The survey results also indicated a negative relationship between compatibility and complexity. Technology was found to positively influence transaction frequency but not relative advantage. Compatibility was found to positively affect result demonstrability and visibility. These results were in the opposite direction to that hypothesised. The predicted relationships between result demonstrability, visibility, trialability, and complexity were not significant.

The case-study evidence placed greater importance on information-technology use than the survey results. Many respondents believe e-mail was vital for cluster coordination. Unlike the survey results, complexity was found not to be an important determinant of relative advantage. The diffusion factors of result demonstrability, trialability, and visibility, however, were relevant to cluster relative advantage.

The main research implication from this thesis is a closer analysis of the relationships among the innovation diffusion attributes. The results imply that future innovation-diffusion research should consider the effects of innovation attributes on each other, as well as innovation adoption. The thesis also affects practice. It provides guidance to consultants and government agencies on how to formulate strategies to increase cluster adoption.
Keyword Business enterprises

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Created: Fri, 24 Aug 2007, 18:23:25 EST