Abstract

This paper studies the nature of the relationship between high involvement work practices (HIWPs), innovation and performance in the context of geographical clusters. We propose and test the mediating role of firm's innovation in the relationship between HIWPs and firm's financial performance in clusters. This paper also studies the influence of a number of geographical cluster features on the development of competitive capabilities related to HIWPs and innovation. Results support that non-redundancy in the manager's contacts network and local rivalry foster innovative capabilities in clusters but not HIWPs.

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