Unlocking Rural Competitiveness: The Role of Regional Clusters

Overview:

The overall purpose of this project was to develop a data base and methodology to assist the nation’s rural areas assess their regional economic competitiveness, and determine strategic growth and development strategies. An information-driven strategic approach to determining regional comparative advantage is considered essential in today’s global and highly competitive economy.

Two interrelated sub-projects were undertaken. The first sub-project involved building a comprehensive database from existing data sources for business and industry cluster studies and the analysis of regional development issues and opportunities in the U.S.

Three broad levels of analysis were undertaken:

• The linkages between cluster composition, degree of rurality and economic performance;
• The spatial clustering of industrial clusters and the interface between rural and metropolitan regions in emerging agglomeration economies;
• Growth trajectories for counties that are differentiated by industrial cluster, degree of rurality, and distance to metropolitan areas.

The second sub-project built upon this foundation and moved it to the application stage in a pilot region. In consultation with Governor Daniel’s office, the research team chose Indiana’s Economic Growth Region 8, an area encompassing eight counties and including the City of Bloomington and the Crane Naval Surface Warfare Center (NSWC Crane).

The pilot application involved the augmentation of secondary data with localized information from surveys, focus groups, and interviews with key informants. The quality of the region’s business environment was emphasized, and an inventory of regional assets that could be leveraged to help the region grow was prepared, as well as a list of liabilities that might present barriers to growth. Identification of competitive niches and implications for strategic actions were considered. Local stakeholders in the pilot region including elected officials, business proprietors, planning agencies, local economic development organizations, and knowledgeable representatives from the social services, education, and related sectors were engaged in the project, and were identified and mobilized by the project team and the Southern Indiana Rural Development Project staff.

Experience from the pilot project was carefully documented. To assist other rural regions in the U.S. in pursuing their own cluster studies and initiatives (and ultimately determining their competitive regional advantage and trajectory for economic success in a competitive globalize economy) a web-based cluster identification tool was developed along with a special project website which is freely available here. The website also makes available all project reports and maps.

This project was funded by a grant from the US Economic Development Administration, and carried out by the Purdue Center for Regional Development, in partnership with the Indiana Business Research Center at the Kelly School of Business, Indiana University, and the Strategic Development Group, Inc., located in Bloomington, Indiana.