The changing fortunes and future prospects of a traditional industrial cluster: Woollen textile production in the Scottish Borders.

I examine the development and current situation of the woollen knitwear and woven fabric industry in the Scottish Borders. The paper opens with a brief theoretical exposition of the logic and dynamics of industrial clusters. An overview of the consolidation of the industry as a multifaceted spatial cluster or agglomeration in the 19th century is presented. I then describe changes in the locational structure and productive capacities of the industry over the last several decades. I provide a diagnosis of the industry's decline in recent years together with an assessment of relevant stocks of region-based resources and capabilities. I argue that the Scottish Borders region lacks many of the pooled competitive advantages typically found in successful clusters but that carefully modulated policy could do much to improve local economic performance in the future. A number of specific policy guidelines focussed on inter-industrial relations, labour markets and institutional infrastructures are examined. [ABSTRACT FROM AUTHOR]