Research on Path Dependence of Industrial Clusters: Taking Xuchang Tobacco Industrial Cluster as an Example

Abstract

As the major carriers for the development of the regional economy and small-and-medium-sized enterprises, industry clusters are faced with challenges of sustainable development in the process of China's industrial upgrading and transformation. This study takes the development history of China's Xuchang tobacco industry cluster as the background, extracts some key concepts from Path-Dependence Theory and then constructs the relational model of path dependence elements, hoping to find out the formation mechanism of path dependence. The study shows that, firstly, learning costs, transaction costs, transformation costs and innovation risks determine what decisions to be taken for those enterprises in the clusters, and they are also the internal economic factors for formation of path-dependence. Secondly, the competence of an enterprise is the main reason accounting for the path dependence of the cluster. Lastly, habit seem to be the social cause and the highlight of the path dependence. Moreover, those path dependence elements are interactive and reciprocally enhanced.