Competitive industry clusters and transportation in Minnesota

Abstract

Purpose – This study aims to advance the state of knowledge of the relationship between transportation and economic development by investigating how firms in competitive industry clusters use transportation networks and what role those networks play in the competitiveness of these clusters. Design/methodology/approach – The approach combines quantitative and qualitative techniques to geographically identify competitive industry clusters and to investigate the role of transportation. The US Cluster Mapping tool is used to identify competitive clusters by employment location quotients in 25 Minnesota metropolitan and micropolitan regions. A total of 12 competitive clusters were selected for further study, and in-depth interviews and site visits were conducted with businesses in each cluster to explore the competitive importance of different modes of transportation. Findings – Minnesota’s economic competitiveness is dependent on a well-functioning transportation system in all modes – truck, air, rail, and water. Access to global markets requires rail and truck to reach coastal ports. Air transportation is critical for high-value, low-weight, time-sensitive products such as medical devices or Mayo lab testing samples. Air service is important for customers at Minneapolis – St. Paul, St. Cloud, and Rochester, Duluth, as well as other Minnesota cities. Highway access and reliability is critical for key statewide clusters such as processed food and heavy machinery. Research limitations/implications – Study limitations include the representativeness of company interviews in generalizing for a cluster and industry employment as a measure of competitiveness. Practical implications – These methods can yield valuable insights into how transportation functions as an input within competitive industry clusters and how it can inform economic development strategies tailored to certain locations and industries. Originality/value – This is a first-of-its kind study using industry clusters as a framework for examining the role that transportation plays in economic competitiveness.