The fundamentals of cluster economic development and its possibilities in the urbanization of the region

the purpose of the study is to investigate, synthesize, and consolidate scholarly approaches, theories, and concepts pertaining to the establishment and effective functioning of urban clusters. The overarching goal is to accelerate the urbanization process and enhance the economic potential of individual regions and the country as a whole. Methods: the methodological framework of this research encompasses comparison, classification, analysis, synthesis, and other relevant approaches. Findings: This current study, focusing on the phenomenon of global urbanization, comprehensively examined theoretical and methodological approaches to defining the concept of “cluster”, which facilitated a novel interpretation of the cluster development approach. Key vectors influencing the competitiveness of the economy via the cluster approach were identified. Particular attention was devoted to a new variant of the cluster approach linked to urbanization and regional development (urban clusters), for which precise definitions were established. The economic benefits of urbanization were analyzed from both demand and supply perspectives. Factors influencing the effectiveness of urban cluster functioning were identified, with most demonstrating an interconnected, multifaceted nature. The mechanisms for implementing urban cluster development were thoroughly explored, including governmental and private sector investments, long-term comprehensive planning, and innovative financing schemes. Based on China's extensive experience, four types of urban clusters were delineated: urban corridors, metropolis-dominated clusters, subnational regional clusters, and cross-border clusters, thereby opening avenues for further comparative analysis. Conclusions: a strategically formulated and effectively implemented urban cluster development strategy offers significant advantages for the economy of a specific region and the state as a whole. Urban cluster development represents a promising direction for enhancing regional economic development, as it ensures inclusive economic growth, accelerates the pace of urbanization, and boosts productivity through economies of scale. Furthermore, it contributes to addressing urban challenges such as environmental pollution. The key success factors include infrastructure quality, the objectivity of the chosen strategy, and the readiness of administrations to adapt to change.

urbanization, economic development, clusters, urban cluster development, economic growth, urban population