In search of the sweet spot: The role of personal proximity in three Dutch clusters

Cluster benefits are positive externalities that arise from geographical, cognitive, and relational proximities. However, recent advances in clustering theory have indicated that this relationship is not always a spontaneous one. While various externalities of clustering may arise spontaneously for co-located firms, some externalities can only be attained when clustered firms and individuals actually work together. The interpersonal nature of cluster governance may have been taken too lightly in the past. Our multiple-case study of three Dutch clusters sets out to reveal what role personal proximity has in clusters over time, and uncovers which accomplishments and issues in cluster governance are associated with personal proximity. We find that personal proximity promotes effective cluster governance, but that there is a 'sweet spot' when it comes to the extent of personal proximity within clusters. That is, not only weak personal proximity, but also strong personal proximity, impedes rather than promotes effective cluster governance.