The Application of Cluster Analysis to Entrepreneurial Perception of Regional Economic Environments

Abstract

This paper evaluates nine elements, comprised of 233 entrepreneurs' locational attitudes in two Canadian metropolitan centers, for evidence that perception of the same region differs according to metropolitan location, and that locational images are related to specific types of manufacturing activity. Hierarchical cluster analysis is used to group attitudes that entrepreneurs hold toward their regional economic environments into patterns of similarity, and to provide visual and quantitative evidence for the level at which various firms enter a group, and the number of alternative groupings which are undertaken before any two firms comprise the same group. The paper concludes that a single ‘regional economic milieu’ does not exist for all entrepreneurs inhabiting the same regional location, that entrepreneurs' attitudes differ between and within the region's two metropolitan centers, and that decisionmakers perceive regional location opportunities as individuals, according to their personal needs and those of their firm (but not of their industry).