Clustering and the internationalisation strategies of SMEs in the media industry

This paper draws together three strands of literature – those on clustering, entrepreneurship and internationalisation, examining the relationship between these three in promoting firm formation and growth within clusters. The evidence drawn on includes large-scale econometric models based on two unique data sets, an in-depth interview survey and a questionnaire survey. The key conclusions are, firstly, that strong clusters promote entrepreneurship, which in turn promotes cluster strength in a self-reinforcing dynamic. Secondly, some firms are better able than others to benefit from cluster location due to superior firm competencies and absorptive capacity. Thirdly, cluster strength contributes to the ability of entrepreneurial firms to expand overseas. Importing activity is also extensive. Internationalisation is one dynamic feedback loop in cluster strength, whereby increased internationalisation yields benefits to firms which spill over more widely in the cluster, and leads to further internationalisation. The Resource-Based View (RBV) emerges as an important theoretical framework linking cluster theory and international entrepreneurship.