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Industrial clusters and technological capability in small firms: an empirical study of two foundry clusters in South India

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  • N.V. Raghavendra
  • M.H. Bala Subrahmanya

Abstract

Industrial clusters, by virtue of dense sectoral and geographic concentration of interlinked firms, are believed to have the intrinsic potential to be technologically dynamic and innovative. This paper explores the influence of various learning mechanisms on the acquisition of technological capability in small firms in industrial clusters through a field study conducted in two foundry clusters in South India. Empirical evidence gathered during 1999–2001 among 98 firms shows a strong relationship between technological capability and the various learning mechanisms that are believed to influence it. Secondly, the study also shows that acquisition of higher technological capability translates into improved economic performance of the individual firms in the cluster.

Suggested Citation

  • N.V. Raghavendra & M.H. Bala Subrahmanya, 2005. "Industrial clusters and technological capability in small firms: an empirical study of two foundry clusters in South India," International Journal of Entrepreneurship and Small Business, Inderscience Enterprises Ltd, vol. 2(4), pages 358-376.
    • Handle: RePEc:ids:ijesbu:v:2:y:2005:i:4:p:358-376
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