Transformation of an Industrial Cluster: The Case of Metalworking in Nairobi
Abstract
Industrial clusters have increasingly become' the engine of growth
in developing countries because of agglomeration economies.
Motivated by success in East Asia, Kenya's industrialization
initiatives now hinge on the promotion of industrial clusters. This
paper explores the growth prospects of garage mechanics and
metalworking enterprises by rigorously analyzing primary data on
enterprise in one of the largest industrial clusters in Nairobi. It is
evident that while the industry is generally growing in terms of the
number of workers and value added, some of the enterprises are
undergoing transformation from being informal to formal. Although
their products are generally crude, they now find it profitable to
improve product quality. Quality improvement is undertaken by
entrepreneurs who are highly educated, have experience from the
formal sector, have received technical training, have taken more
business trips, and those taking advantage of the cluster's tradition
of the division of labor.
Publisher
Institute of Policy Analysis and Research Norfolk Towers, Harry Thuku Road/Kijabe Street Junction, P.O.Box 45843-00100, GPO, Nairobi, Kenya. Tel. (+) 254 20 251179/252885/331786 Fax: (+)25420251162 Email: info@ipar.or.ke Website: http://www.ipar.or.ke Institute for Development Studies, University of Nairobi