Global Advantages Of Industrial Clustering

Drawing on its vast population and mix of free-market and central-command economic policies, China has created giant industrial districts in distinctive entrepreneurial enclaves such as Datang. Each was built to specialize in making just one thing, including some of the most pedestrian of goods: cigarette lighters, badges, neckties, fasteners.

Industrial clusters are like one-stop production centers, achieving economies of scale and driving innovation by geographically bunching suppliers, manufacturers and contractors.

...But what gives Zhong and others like him a real edge — an edge even other low-wage countries like Pakistan can't equal — are the benefits of clustering. Although manufacturing clusters aren't new, with Italy especially known for them, the Chinese have taken it to a new scale.

Thanks to Chris Steins