Can Carpooling help with Economic Development?

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Can Carpooling help with Economic Development?

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From “Cluster Analysis for NewVA Region (2004)”

The concept of industry clusters and cluster based strategy has been a vibrant topic in economic development circles over the past couple of decades.  Specific cluster related studies or profiles that cover the combined New River and Roanoke Valleys, Alleghany Highlands and Region 2000 (Lynchburg) have been completed in the past decade and have been useful in regional economic development initiatives.

The famous Harvard Business School professor Michael E. Porter defines clusters in “On Competition” as:

[A] geographically proximate group of interconnected companies and associated institutions in a particular field, linked by commonalities and complementarities.”

He goes on to say that:

Many of the competitive advantages of clusters depend on the free flow of information, the discovery of value-adding exchanges or transactions, the willingness to align agendas and to work across organizations …networks, and a sense of common interest undergird these circumstances. The social structure of clusters thus takes on central importance.

It is precisely in helping to improve the free flow of information, and to solidify professional relationships that carpooling, vanpooling and transit use can make a surprising, and often overlooked contribution to regional economic development.  In a recent blog it was argued that carpooling and vanpooling help facilitate the person-to-person conversations that generate ideas and facilitate teamwork in organizations.  This same effect can be multiplied when carpool, vanpool or transit commuters are from the same industry clusters, but not necessarily the same companies.  The potential for serendipitous discovery of innovative ideas via face-to-face conversations shouldn’t be underestimated.  Carpooling, vanpooling and transit may provide the only opportunities for in person conversations with certain other professionals in the same cluster that otherwise wouldn’t cross your path during your busy workday.  This networking effect was even observed at the recent World Economic Forum in Davos, Switzerland. CNN did a story on the Davos shuttles being the ultimate networking tool at the Forum in some cases even more so than the sessions and events themselves.  If even the world’s business, economic and political elite find value by having face-to-face conversations while sharing a ride, just imagine the hidden potential for regional economic development in our part of Virginia.

5 thoughts on “Can Carpooling help with Economic Development?

  1. Love this idea. We do a whole unit on clusters (usually at city/metropolitan levels) in my class. It’s basically overlooked in most textbooks but the real world is driven by clusters. For example, a few clusters in England (London, Cambridge) can explain much of the country’s economic growth. The role of formal and informal networks is huge. Carpooling could be one of those… in Cambridge there are a lot of bikepaths though (!) Anyway, interesting take and nice support from Davos. How do you define an industry? Most of Cambridge is ICT but you can declassify into dozens of high tech industries within that (biotech, software, etc). The carpool may be as good as avenue as the elevator or the water cooler in an incubator space with lots of dynamic new ventures that are actively seeking good information to act upon. How do you set this up? There must be an application for this to sort out carpoolers?

  2. Thank you Ting and Siri for commenting on the blog. Several of the studies that were linked in the blog used combinations of SIC, NAICS or similar codes to arrive at the cluster. I suspect that it was a combination of analysis and judgement. I was not an author on any of the cluster studies. In most cases, a colleague or two in the office had involvement, and then there were consultants and other organizations such as the VT Office of Economic Development. The trick will be to see if there is a convenient way, from a marketing perspective, to target market the clusters for rideshare. I am hoping that through this blog we will discover someone who has taken exactly that approach. So far, there are not specific trade organizations for the clusters in our area. The closest thing would be an overall Technology Council. If there is anyone out there who has marketed rideshare services to industry clusters as a target market, please add a comment.

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