Possibilities of applying the cluster approach in the study of the stability of the regional territorial organisation of production areas

Abstract

Various assessment criteria are applied to ensure the sustainability of production sites. These evaluation criteria are based on quantitative indicators and reflect the corrected performance of production areas. Adequate assessment analyses the territorial organisation of production areas, efficient operation, process management, etc. more clearly in the future, and makes it possible to conduct their comparative analysis. One of the methods of such an approach is the cluster. A cluster is a group of objects with similar properties. In English, cluster means bunch, gathering, concentration, and group. From this point of view, the for- mation of the infrastructure organised in connection with the production, which contributes to the increase of competitiveness between the production areas, and the application of an innovative cluster approach are required in this research work. This approach allows the creation of a new product, increases production efficiency, and helps form a sustainable production network. This article presents the analysis of the GDP in Azerbaijan in the period of 1995-2021 carried out taking into account the ratio of the AZN to the US dollar, calculates the volume of GDP per capita, determines the regional trend of economic development, and provides the variability of the dynamics in the fields of the economy in a related manner. Later, all these indicators were summarised, clustering was carried out, coefficient values of quantitative indicators for production areas were determined, and indicators of clustering of production areas for economic regions of Azerbaijan were calculated. Consequentially, the article concludes that the application of the regional cluster approach indicates the potential power of production enterprises, the scale of their activities, economic-geographical relations, etc., which makes it possible to increase regional competitiveness between production areas. Thus, the cluster approach determines competitive advantages related to the organisation and operation of production, stimulates regional development, and can also lead to an increase in revenues to the local budget.