Regional clustering in Australia

Two seemingly competing tendencies, the globalisation of economic activity and the localisation of industries, have captured the interest of scholars, economic development professionals, and policymakers in recent years. While trends towards globalisation of industries and companies might appear to reduce the importance and distinctiveness of (sub-national) regions, a tendency towards localisation of certain industries and economic activities appears to do exactly the opposite. The simultaneous globalisation and localisation tendencies have created policy challenges for national and local governments. One response to these challenges has been a dramatic proliferation of regional development policies based on regional clusters of firms and industries. This chapter explores the phenomena of clustering in the international and Australian contexts. A brief description of public policy initiatives, recent research and three brief case studies of regional initiatives to foster the development of industry clustering in Australia are presented. The conclusion discusses lessons and future directions for clustering in Australia.