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Trajectory Dependence, Lock-In Effect, and Cluster Decline: A Case Study of the Footwear Cluster in Sinos-Paranhana Valley

Abstract Within the cluster literature, few studies have analyzed the potential dangers of regional economic overspecialization. The lock-in effect is frequently mentioned to describe the decline of a cluster, but few studies have actually tested such arguments. The purpose of this paper is to analyze the impacts of the lock-in effect on the evolutionary trajectory of the Vale dos Sinos-Paranhana footwear cluster. To this end, we conducted interviews with industries and representatives institutions, to analyze how productive and cognitive inertia, the absence of innovative startups and the static entrepreneurial model adopted by local agents limited the acquisition and recombination of new knowledge within the cluster, making it a rigid and uncompetitive structure.