1. INTRODUCTION

The role of inter-organisational networks and inter-personal networks in industrial clusters is not new. Research conducted by Chetty and Agndal (2008) shows that despite the initial reluctance for firms to collaborate in industrial districts, organisations learnt to maintain a balance between competition and cooperation. This is done through formal and informal formalisation of relations between actors at the organisational and individual levels.

The above is key for firms to compete in global markets. However, doing this in the Chilean economy, which is predominantly based on natural resource exploitation, is not easy.

It is well known that there are difficulties and opportunities to achieve business, economic and social growth based on natural resource-dominated industries. For example, over the past five decades, Scottish businesses have made concerted efforts to diversify into more knowledge-based forms and compete in global markets, with varying degrees of success. Firms have often achieved greater competitiveness and growth, and new firms have formed more frequently when they work within a cluster.

Clusters, however, do not form spontaneously, but are heavily influenced by promotion, funding, public policy, social awareness, open collaborative values and formal professional management over decades.

This research is concerned with cooperative strategies among natural resources cluster-based firms, illustrated by the factors that influence the development of co-marketing activities. Theorists have consistently demonstrated the role and importance of economic externalities, such as knowledge spillovers, within industrial clusters. Less research attention has been paid to the investigation of marketing based externalities and their influence on the competitive strategy of firms, though it has been suggested that these may also accrue from geographical agglomeration. This under-explored issue in the literature is addressed in this research.

The main research objectives of the paper are: (1) to examine the relationship between the issues related to regional clusters in developing positive externalities which yield inter-firm cooperation in marketing; (2) to explore to what extent elements of co-location and networking influence inter-firm co-operation in marketing; and (3) to compare similar clusters in two different countries.

The paper starts by reviewing the literature related to geographic co-location and social networking. The research methods and industry selection are presented later highlighting the relevance of this specific industry for this study in a comparative perspective between Scotland and Chile. Finally, results, conclusions and recommendations are presented.

2. LITERATURE REVIEW

Industrial districts have received substantial attention from scholars in several fields, as well as from governments and policy-makers during the last few decades. Small countries heavily dependent on natural resources such as New Zealand, Denmark, Sweden, Finland, Scotland and Chile the concept of 'industrial district' has been used by policy-makers to encourage more generic collaboration and clustering of economic activity for foster international competition.

Chetty and Agndal (2008) discuss that in particular, industrial districts have been used by SMEs to develop their international markets, to develop innovative products and marketing strategies, and to identify business opportunities. These industrial districts allow SMEs to benefit from economies of scale. Policy-makers have recognized the importance of SME leaders in acting as catalysts to initiate the development of an industrial district (Chetty 2004).

Firms in regional clusters may discover that although the district allows for increasing collaboration, it simultaneously fosters competition. Balancing collaboration and competition thus becomes an important aspect of belonging to an industrial district (Chetty & Agndal 2008).

Taking the mix between cooperation and competition, it is important to note that Marshall (1920) introduced the concepts of co-partnerships, social elements of proximity and co-operation among industries. He combined the concepts of industrial districts, town development and marketing. This indicate that the 'soft' elements of personal contact between traders, customers and producers, as well as the exchange of information, the circulation of new ideas and the diffusion of innovation (Scot 1986; Bellandi 1987, 2001), were one of the main ideas considered to be Marshall's contribution to agglomeration theories. Marshall also introduced the concept of external economies (1) as the economies of scale benefits derived from industrial location.

Brown and McNaughton (2002) comment on Marshall works discussing that from the three main external economies of localisation, which are concentrated on economy of production, there is a fourth element that most of the authors do not properly acknowledge when they discuss Marshall's contribution. This factor is market related. This means, the convenience of customers looking for specialised--geographically concentrated--suppliers. Thereafter, geographically concentrated industries may enhance the customers' perception of manufacturer credibility, adding more value to them through reducing search costs (Zaratiegui 1997). In other words, Marshall influences some of the ideas about marketing in industrial clusters introducing the concepts of 'mutual discovery' as key advantage of co-location. That is, co-location lessens the search of cost of buyers, and this is an important influence on the contemporary retail location theory. Like Marshall, Weber (1929) combined the geographical location of industries with the concept of marketing factors as social benefits of regional agglomeration economies.

The different examples of clusters development around the world provide 'evidence that even as competition and economic activity is globalised, the competitive advantage can be localised' (Enright 1999: 35). Simultaneously, during the last few years, various studies in dissimilar industries have concluded that the geographical implication of clusters has an effect on the development of local wealth, not only attracting foreign investors, but also generating global networking and helping in the export and internationalisation process of companies as part of 'regional clusters' (Felsenstein & Taylor 2001; Rosenberg 2001). On the other hand, Morgan and Hunt (1994) have suggested that to be an effective competitor in the global economy requires more cooperation or networking between firms, which will lead to establish or maintain a marketing competitive advantage. This argument can be seen as a strategic issue for small and medium sized enterprises (SME's), especially those located in open and small economies, which must seek out different alternatives of differentiation, obtaining in the end a marketing competitive advantage (Brown & Bell 2001).

The argument of and benefits from cooperative strategies, at formal and informal levels, among firms has been a key research topic within the Industrial Marketing and Purchasing Group (IMP) literature (Hakansson et al. 2006). Network research, has been less explored in the industrial district literature. This unexplored research is concern with the role of personal, social or inter-personal networks (Ettlinger 2003). These networks can be done at formal and informal basis. Firms using formal networks also refer to the concept of strategic alliances or strategic networks (Agndal & Axelssson 2002). During the last decade, the growth of alliances has been an interesting topic among both academics and practitioners. While multiple factors may affect alliance success, partner selection emerges as one of the most influential, but this may vary depending on alliance project type (Shah & Swaminathan 2008)

There seems to be an agreement and consensus that clusters and strategic alliances provide general benefits to firms, especially in the value chain inputs as well as in the general aspects of the production process (Olsen 2002; Mackinnon et al. 2002, 2004). However, as Brown and Bell (2001: 11) state, 'limited research exists to indicate the degree of impact that clustering has on marketing activities in a domestic and international context'. Furthermore, research on strategic behaviour of firms has been mainly concentrated on large scale firms. Therefore, the knowledge base about strategies and in particular, the marketing strategy of small firms is still quite limited.

2.1 Social networking for innovative clusters

Social networking in a cluster setting has been extensively researched. Clusters have been defined as 'local or regional dimension of networks' (van Dennerg, Braun & van Winden 2001: 187). Maskell (2001) suggested that the social process of learning and innovation in inter-firm cooperation work best when partners involved are close enough to one other to allow frequent interaction and effective exchange of information. At the same time, this social process is embedded in regional communities that share a common knowledge base and culture (Cooke 1998). Furthermore, this close proximity at regional level facilitates frequent face-to face interaction at both, formal and informal settings. This process creates a common language or code of communication through repeated interaction over time (Patel & Pavitt 1994), which leads to the creation of regional institutions that helps to reinforce the right environments for inter-firm interaction (Wolfe 2003).

The 'soft' elements of interaction: trust, commitment, mutual knowledge, communication and similarity among partners, help to build the social networks, which may lead to a greater cooperation among firms. Furthermore, these elements combined with the historical and cultural embeddedness of specific local regions, as well as co-location factors with interaction in the value chain activities, may lead to the result of networking and inter-firm co-operation in geographical regions, as the ones in the salmon farming industry in Chile and Scotland.

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