Discussion Papers

No.698 Knowledge and Information Acquisition of Cluster Firms through Personal Networks and Value-Chain Linkages: A Case Study of China’s Mobile Phone Manufacturing Industry

by Shiro Hioki, Ke Ding

March 2018


This article investigates how heterogeneous firms in China's industrial clusters (ICs) acquire the external knowledge and information necessary for their businesses. We developed an empirical analysis of a sample of 107 firms in China’s mobile phone industry to determine how different types of knowledge and information are conveyed through a variety of conduits, particularly personal network and value-chain linkages. We find that personal networks played important roles when firms gathered a variety of knowledge and information, whereas firm heterogeneity mattered when they gathered core technological knowledge and information. Larger firms tended to depend more on vertical linkages with suppliers, particularly platform vendors, whereas smaller firms relied more on personal networks when they obtained core technological knowledge and information. Several academic and policy implications are derived from the findings.

Keywords: cluster; knowledge, personal network, value-chain, China
JEL classification: O14, O18, O53

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