Associated economy - Wide effects of transport and logistics clusters

Regional competitiveness can be improved by providing value-added services, such as transport and logistics services to both the local and global supply chains. Transport and logistics clusters have been shown to reduce trade transactions and to improve the efficiency of both local and international transactions. The aim of this study was to identify the sectors that comprise the transport and logistics cluster and to determine the cluster's associated economy-wide effects. Using a cross-sectional study design, location-specific competitive advantages and economic multipliers associated with the clustering of transport and logistics companies were computed for the North-West Province in South Africa. Findings illustrate that the transport and logistics cluster comprises seven sectors that associate positively with upstream and downstream multipliers in various sectors within the region. Additionally, the sectors in the cluster are relatively integrated and have high interlinkages. The cluster has potential for higher levels of integration once the cluster is strengthened. In the context of South Africa, this implies that transport and logistics cluster optimisation has a knock on effect on various industries including tourism as shown elsewhere. This study offers a unique econometric approach to identify and quantify the effects of transport and logistics clusters on regional competitiveness and provides practitioners and policy makers with insights into alternative strategies to enhance regional competitiveness and growth.