Competitive capabilities in territorially clustered firms: The strong-tied and cognitive-cohesive social network effect

Recent studies are supporting the idea that understanding the dynamics of firms’ value creation requires a complex and indirect association with their relational or social resources. In particular, in bounded geographical contexts this approach is replacing initial, perhaps too simplistic, assumptions. With this paper our aim is to contribute to this growing stream of research. The work focuses on the specific effects of the strength of ties and the cognitive cohesion of clustered firms on the development of their competitive capabilities. We formed a unique dataset based on a sample of 116 clustered firms from the Spanish fishing sector, where competition is based on efficiency more than on differentiation or any other valuable activity. Our results show that the cognitive cohesion of a clustered firm has a positive curvilinear relation with its competitive capabilities. Yet, contrary to expectations, the strength of ties of a clustered firm has a significant negative curvilinear relation with its competitive capabilities. The implications and contribution of our findings to the literature on both social capital and regional clusters are discussed.