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The Division of Labor and the Formation of Industrial Clusters in Taiwan

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  • Tetsushi Sonobe
  • Keijiro Otsuka

Abstract

While the role of clusters in promoting industrial development has been increasingly recognized in the literature, the locational choice of industrial clusters and the underlying factors affecting such a choice have seldom been analyzed, particularly in the context of industrial development in developing countries. In this article, the authors hypothesize that industrial clusters tend to be formed in suburban areas, where the division of labor among enterprises producing diverse products is intense. They obtained supportive evidence through regression analyses of changes in employment and value‐added ratio using township‐level census data of selected industries in Taiwan from 1976 to 1996.

Suggested Citation

  • Tetsushi Sonobe & Keijiro Otsuka, 2006. "The Division of Labor and the Formation of Industrial Clusters in Taiwan," Review of Development Economics, Wiley Blackwell, vol. 10(1), pages 71-86, February.
    • Handle: RePEc:bla:rdevec:v:10:y:2006:i:1:p:71-86
    DOI: 10.1111/j.1467-9361.2005.00301.x
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    1. Ruan, Jianqing & Wei, Longbao & Zhang, Xiaobo, 2006. "Clustering as a Way to Lower Capital Barriers: The Case of the Cashmere Sweater Cluster in Zhejiang," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25280, International Association of Agricultural Economists.
    2. Tetsushi Sonobe & John E. Akoten & Keijiro Otsuka, 2009. "An Exploration into the Successful Development of the Leather‐Shoe Industry in Ethiopia," Review of Development Economics, Wiley Blackwell, vol. 13(4), pages 719-736, November.
    3. Henri L.F. de Groot & Jacques Poot & Martijn J. Smit, 2007. "Agglomeration, Innovation and Regional Development: Theoretical Perspectives and Meta-Analysis," Tinbergen Institute Discussion Papers 07-079/3, Tinbergen Institute.
    4. Xu, Cheng-Gang & Guo, Di & Jiang, Kun & Yang, Xiyi, 2017. "Clustering, Growth, and Inequality in China," CEPR Discussion Papers 12543, C.E.P.R. Discussion Papers.
    5. Long, Cheryl & Zhang, Xiaobo, 2012. "Patterns of China's industrialization: Concentration, specialization, and clustering," China Economic Review, Elsevier, vol. 23(3), pages 593-612.
    6. Masaki Nakabayashi, 2017. "Honesty, Diligence and Skill: Risk Sharing and Specialization in the Kiryu Silk Weaving Cluster, Japan," Review of Development Economics, Wiley Blackwell, vol. 21(4), pages 1401-1424, November.
    7. Keijiro Otsuka, 2006. "Cluster‐Based Industrial Development: A View From East Asia," The Japanese Economic Review, Japanese Economic Association, vol. 57(3), pages 361-376, September.
    8. Merima Ali & Jack Peerlings & Xiaobo Zhang, 2014. "Clustering as an organizational response to capital market inefficiency: evidence from microenterprises in Ethiopia," Small Business Economics, Springer, vol. 43(3), pages 697-709, October.
    9. Hinh T. Dinh, 2017. "Jobs, Industrialization, and Globalization," Books & Reports, Policy Center for the New South, number 16, December.

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