Clusters of Enterprises Within Systems of Production and Distribution: Collective Efficiency and Transaction Costs

The concept of collective efficiency in enterprise clusters proposed by Schmitz [1989] and developed in the recent literature on flexible specialisation in developing countries [Rasmussen et al., 1992; Pedersen et al., 1994] is related to and partly takes the place of the older concept of agglomeration economies. Although both the empirical outlook and the theoretical basis of the two concepts are very different, we believe that a comparison between them may be fruitful to our understanding of collective efficiency.