The Relocation Of Cluster Firms: Factors, Patterns And Performance

The Phenomenon of many firms relocated in industry clusters attracted the attention of some scholars, but there resesches are still limites to the development risks of industry cluster. Although some studies emphasize the behavior research of firms in cluster is important since 1990s, so far little is done in relocating behavior of cluster firms at micro level. In sharp contrast, a large number of researches have been done on general firm relocation. Those researches could mainly be devided into three schools, the neoclassical school point out relocation just accur if the external influence and the internal needs have changed and the behavioral school emphasice the decision-making process of relocation and the role non-economic factors play in that process, and the institutional school streeed the effect of inter-organizational relations, social systems and some other factors on firm relocation.The hypotesis of firm which institutional school emphasized is consistent with the characteristics of cluster firm, and the analytical framework of this theoretical school could be used to explore the migration behavior of cluster firms. However, this theory is far away from modeling and empirical analyzing because of the lackage of appropriate analysical tools. Based on analysical framework of the insititutional school and analysical tool of the industry cluster studies, this paper builds the four-factor model and the contingency model of migration decision-making for cluster firms. And the influence which cluater firms' characters on their relocation patterns selection is also studied in this paper. Furthermore, the paper has expored the relationship between the decision-making, the pattern of migration and the performance for cluster firms. Based on data collected from survey and public databases, there are four main conclusions could be summarized from the empirical analysis of this study.Fistly, the four-factor model which taking into accout the network characteristics of cluster firms is better than the traditional three-factor model in explaining the relocation decision-making of cluster firms. And enterprises features, location features and network features showed a significant impact on migration decision-making. In particular, firms which are in urban centers, young or have an open network in geography are more likely to relocate.Secondly, cluster firms'satisfaction on environment has a regulation on relationship between enterprise features, location features, network features and the migration desition-making. Cluster firms located in urban periphery or rural area and old enough who are not satisfied on environment are more likely to relocate, and cluter firms owned a large local network or an open network in geography who are satisfied on environment are more unlikely to relocate.Thirdly, location features and network features of cluster firms affect the establishment of relocation, enterprise features and network features of cluster firms affect the geographical scale of relocation, and location features and network features of cluster firms affect the area type of relocation. Specifically, firms located in rural area, owned a small local network and far from the network center will have the whole corporate to relocate, firms located in urban periphery and owned a large local network will relocate their headquarter, firms in the network center will relocate other departments, firms own a weak local relationship and small enough will relocate in local, firms who is old enough will relocated within province or out of the province, firms owned a large local network will relocate to urban center, firms located in urban area and owned a small local network will relocate to urban periphery, and firms located in rural area and owned a small local network will relocate to rurual area.Fourthly, the difference in performance of cluster firms is due to the relocation decision-making and the relocation patterns. Cluster firms who relocated have better performance in financial and growth than firms who did not move, the financial performance are distinctive among firms who had different department to relocate, relocated in different geography scale and relocated to different areas, and the growth performance are distincetive among firms who relocated to different areas.Compared to researches which are related to the relocation of cluster firms, this paper innovated in the following aspects:First of all, build the four-factor model and contingency model for relocation decision-making of cluster firms. Although the institutional school of firm migration has been conscious of the importance of relationship and the network between firms, these researches are still analysised from theorical view. Combined with the network analysis, this paper builds a four-factor model and a contingency model which have considered network features for relocation decision-making of cluster firms. Up to a certain extent, this paper has maked up the shortage of institutional school of firm migration in empirical research.Second, distinguish the relocating behavior of cluster firms from the micro level. All of the centrifugal force model, the local locking model and the negative externalities model treated the relocation as an event, and discuss the relocation of cluster firm from meso level. Based on the empirical date, this paper concerned about the relationship between features of cluster firms and their relocating behavior. The empirical analysis identified the behavior charactors for relocation of cluster firms, and promoted thees research to be more comprehensive.Third, receals the relationship between the relocating behavior and the performance for cluster firms. Little has been studied for the performance of relocated firms, and the conclusions of different researches are varying because of samples, performance indicatiors and the respect emphasized are different. The empirical analysis of this paper discussed the difference of financial and growth for cluster firms which have behavioral disparity in relocation. And the conclution showed that migration is effective for cluster firms to achieve growth but is limited in upgrading the viability for cluster firms, and different migration patterns for firms with different features and have different effect on improving the viability of cluster firms. This paper has enriched the research of the performance of relocated firms.It is just a preliminary exploration, and it is far away from a systematic framework and an empirical analysis. The weakness of this paper reflected in there aspects, the selection of variables, the external validity of empirical finding and other factors affected the relocation behavior. Future research can be taken in following aspects. First, explaining the relocation decisions for cluster firms from the geographical embeddedness and organizational embeddedness. Second, track the migration for typical individual cluster firms with case study. Third, investigate the role life cycle stage, business development strategy, migration experience and other factors on the relocation decision-making of the cluster firms. Fourth, take the environmental uncertainty instead of the environmental satisfaction as the contingent factors affecting the migration of clulster firms. Fifth, analysis the effect cluster firms relocation behavior on cluster evolution.