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Equilibrium Analysis on MNC-led Industry Clusters

Author: LuMin
Tutor: XingJianGuo
School: Suzhou University
Course: World economy
Keywords: industry cluster multinational companies equilibrium
CLC: F224
Type: Master's thesis
Year: 2011
Downloads: 23
Quote: 0
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Abstract


The industry cluster is an important growing up form of the industry. As a kind of special industry clusters, MNC-led industry cluster plays a more and more important role in the development of the industry in our country. In this kind of industry cluster, there are two basic subjects: multinational companies and associated enterprises. The gains and its equilibrium of the two subjects through the cluster relates to the development, expansion and evolution of the industry cluster. Through the industry cluster, multinational companies internalize the cluster’s geographical advantages, organize and control the associated enterprises effectively, expand the border of the multinational companies’monopolistic competition advantages. Through the internal mechanism of the industry cluster, associated enterprises take the comparative advantages into competitive advantages, promoting their transformation to international enterprises. But the equilibrium of the two subjects depends on many factors and has a special restriction mechanism. Based on an ecology model of MNC-led industry clusters on equilibrium, this paper analyses the formation and the dynamic evolution of the cluster, and comes to a conclusion that the scale of the cluster, the mechanism of rent distribution, the structure of enterprises, and the government’s drive are the important factors that affect the dynamic equilibrium of the cluster. At last, based on the factors, the paper puts forward some relevant policy suggestions.

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CLC: > Economic > Economic planning and management > Economic calculation, economic and mathematical methods > Economic and mathematical methods
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