Purpose – The main purpose of this paper is to propose a model of economic development able to generate a cross‐border sustainable economic development, in regions in conflict. The Italian industrial district model implements a community industry synergy process led by the authorities according to a top‐down approach. The cluster model implements a clustering specialization process led, in the American version, by a bottom‐up approach and in the European version by a top‐down approach. The regional innovation system (RIS) provides the regional and international innovation networking required for both models in order to confront the global competition. The proposed progressive model creates the industrial specialization (industrial district) required for the development of the clustering process supported by the RIS. Design/methodology/approach – The authors have selected, from the list of producers (growers and producers of olive oil), a random sample of 103 growers of olives and producers of olive oil from both groups from the Northern regions (Galilee in Israel and the Northern West Bank): 26 Palestinian growers, 25 Palestinian producers, 13 Israeli growers and 39 Israeli producers of olive oil, and interviewed them. Findings – The results show that the community‐industry synergy of the industrial district model is supported by the economic actors from both sides of the border but refused for political reasons by the regional authorities and professional associations. The raw material (olives), the human capital and the knowledge required in order to start the clustering process exist. Practical implications – The study has evaluated the Israeli‐Jewish and Arab and the Palestinian olive sector, and clearly indicates that bottom‐up decision‐making process is the only way for the moment for initiating the cluster and RIS models in the olive sector. The intervention of a third party is required in order to start the bottom‐up implementation of the industrial district model and launch the clustering process. Originality/value – The main contribution of this paper lies in organizing the industrial district in such a way that it will generate a cluster in the long run. Thus, it is called progressive model.
Cross Cultural Management: An International Journal – Emerald Publishing
Published: Aug 2, 2011
Keywords: Economic development; International conflict; Free economic zone; Industrial district; Cluster; Progressive model; Regional development; Israel; Palestine; Olives