Public and Private Sector Entrepreneurship as a Tool of Dynamic Functioning of Tourism Cluster at the Territories of Outstripping Development (Case Study of Primorsky Krai, Russian Federation)

Abstract

Priority development areas (PDA) may serve as a basis for entrepreneurship development in tourism, creating a more competitive environment for entrepreneurial activities in relation to similar territories in the Pacific Rim. The key principles of these territories are radical deregulation and massive tax incentives. The process of creating priority development areas plays depends on the coordination of all members of the alliance which includes Federal government and business units. The purpose for the present study is to develop a mechanism of tourism cluster functioning in priority development areas through public and private sector entrepreneurship. In the framework of the set purpose the following objectives are fulfilled: the authors analyze the legislation of priority development areas; assess the current state of tourism and tourism infrastructure; develop a mechanism of tourism cluster functioning in priority development areas through one of the forms of public and private sector entrepreneurship – public franchising. During research the authors used methods of economic-statistical and comparative analysis, graphical description. Unlike other researchers, the authors applied an integrated approach to the implementation of the mechanism of state and business structures interaction. The research is based on the legislation on priority development areas functioning, the cluster approach on the example Primorsky Krai tourism. The research results revealed the peculiarities of the cluster approach application for efficient tourism functioning. The authors analyzed tourist potential of Primorsky Krai and identify the specifics of using public and private sector entrepreneurship for the development of priority development areas. The study reveals the differences between public and private sector entrepreneurship, public franchising and public service outsourcing, which is undoubtedly interesting for researchers of this issue. The proposed mechanism of interaction of state and business units with elements of the tourism cluster in the form of public franchising in priority development areas will bring the internal tourism product of Primorski Krai to the international level. The mechanism is based on partnership of the state (the Franchisor) and business (the Franchisee) sector in the tourism cluster, which will ensure the inflow of investments in development of tourist attractions and infrastructure in priority development areas and support small and medium business. This will ultimately lead to the implementation of strategic goals for the development of the Far Eastern territories in the framework of the state program

Keywords

• priority development areas
• tourism cluster
• public and private sector entrepreneurship
• public franchising