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Definition of a Cluster

Geographically bounded concentration of similar related or complementary business with active channels for business transactions, communications and dialogue that share specialised infrastructure, labour markets and services, and are faced with common opportunities and threats. (Rosenfeld, Over Achievers: Business Clusters that Work, Prospects for Regional Development, cited in Williams 1997, 25)

Or

A group of businesses concentrated in a particular geographical area that:

• Rely upon each other for business support, competition, technology, linkages, information etc.
• Have a common support base; and
• Are linked by their activities in a particular industry

The purpose of a Cluster

THE PURPOSE OF THE CLUSTER IS TO INCREASE ECONOMIC ACTIVITY, TO FACILITATE BUSINESS TRANSACTIONS AND PROVIDE OPPORTUNITIES FOR GROWTH THAT WOULD GENERALLY NOT BE AVAILABLE TO FIRMS ACTING INDIVIDUALLY