Porter's Diamond of National advantages

Topics: Innovation, International trade, Comparative advantage Pages: 34 (7850 words) Published: December 20, 2013
Transit Stud Rev (2008) 15:303–319
DOI 10.1007/s11300-008-0017-2

Cutting Porter’s Last Diamond: Competitive
and Comparative (Dis)advantages in the Dutch Flower
Ernesto Tavoletti Æ Robbin te Velde

Received: 14 March 2008 / Accepted: 13 April 2008 / Published online: 10 July 2008 Ó Springer-Verlag 2008

Abstract The Dutch are the world’s leaders in the flower business even though they seem to lack comparative advantage in the traditional sense. Comparative advantages played a role in the history of the Dutch flower cluster and they still have a role today. Based on a critic of Porter’s theories, the investigation suggests that the exploitation of comparative advantages is allowed only to those firms and clusters that already possess a competitive advantage, based on technology, logistics infrastructure, innovation and human skills. So that comparative advantages and competitive advantages join in a sort of helix process based on social innovation and collective learning.

Keywords Dutch flower cluster Á Comparative advantages Á
Competitive advantages Á District Á Innovation Á Cluster
JEL Classification

Q17 Á M16 Á L26

The present article is an exploratory case study of the Dutch flower cluster and it is intended to forecast opportunities and threats for its future. The Dutch flower cluster has gone through significant success for decades but recent development in the international markets has raised questions about its competitiveness and environ-

E. Tavoletti (&)
University of Macerata, Macerata, Italy
e-mail: ernesto.tavoletti@unimc.it
R. te Velde
Dialogic Innovation and Interaction, The Hague, The Netherlands e-mail: tevelde@dialogic.nl



E. Tavoletti, R. te Velde

mental sustainability. Is the Dutch flower cluster going to survive the competition from developing countries with cheap labour, superior climate and increasing long distance distribution? Is there a future in a global economy for the over regulated Dutch flower cluster based on family SMEs and greenhouses?

Our research questions have a general theoretical interest in the cluster literature because agriculture clusters are potentially the more affected by superior Ricardian comparative advantages in developing countries. As the Dutch flower cluster is a very high-tech and knowledge intensive one, this makes the issue even more relevant: Can the socially driven knowledge exchanges (Storper 1993, 1995, 1997) and long lasting ‘‘social fabric’’ rival developing countries advantages on production factors?

Porter is the most cited scholar with reference to clusters’ competitive advantage and he defines a cluster as ‘‘a geographically proximate group of interconnected companies and associated institutions in a particular field linked by commonalities and complementarities’’ (Porter 2000, p.16) with a strong focus on constituent firms and no significant reference to the cluster ‘‘social and territorial’’ knowledge while the most recent literature about cluster competitive advantage shifted from the cluster and its constituent firms to the character of the organizational knowledge within the cluster (Tallman et al. 2004; Asheim et al. 2006). Developing countries’ strong performance has introduced some doubts into the general view. Are comparative advantages based on cheap labour and superior climate taking ‘‘historical revenge’’, as opposed to Porter’s competitive advantages and ‘‘knowledge based clusters’’ (Cooke and Leydesdorff 2006)? The article investigates this theoretical issue through the Dutch flower cluster. ‘‘Theoretical framework and methodology’’ presents our theoretical framework and methodology: starting from a critic of Porter’s competitive advantage approach, we introduce a new theoretical framework based on a revaluation of comparative advantages and their dynamic historical relationship with competitive advantages. ‘‘The Dutch flower cluster’’ provides an...

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