The Mechanism Of Industrial Cluster's Development-A Case Study On Pujiang's Crystal Industry Cluster

Industrial cluster, as an important economic phenomenon, plays an important role in economic development now. This paper studies the mechanism of industrial cluster's development based on the evidence from PCIC (Pujiang'crystal industry cluster).Firstly, it analyzes the cause such as special human resource, demand, cheap labor force and land resource, and enterprise's analysis of cost and benefit, affects the form of PCIC by reviewed the developing course of PCIC. We also find that a single enterprise is lacked of competitive advantage on human resource, capital accumulation, enterprise systems or technology level, but the whole cluster has been certificated that it has competitive power. Based on this background, the paper studies the mechanism of cluster's development from perspective of division and specialization, and interprets concretely based on the logic deduction of the relation of division and cluster evolution. Division deepening can improve productive efficiency and increase return, but it also increase transaction cost inevitably. Industrial cluster appears for coordinating division and decreasing transaction cost.We also find that division evolution is a spontaneous and progressive process. In this process the industrial chain circuitous continuous and the network in cluster becomes more complex. So the division type inside industry presents different feature in different stage of cluster's evolution. Besides enterprises in cluster have the division on technology study because of the difference of economic force and technology ability. Then the paper analyzes the role of specialized market, government and media organization. The interactive relation between specialized market and industrial cluster can strengthen the competitive advantage for each other; Government plays an important role in institute supply, capital support, public product support, innovation environment build and governance; The profession association, as one of the main organization of media organization, has some effect in the forming of cluster, but its function should be improved. In the last part, on the basis of the former conclusion this paper put forward some suggestion for policy.