Global Capitalism, FDI and Competitiveness

Global Capitalism, FDI and Competitiveness

The Selected Essays of John H. Dunning, Volume II

John H. Dunning

Global Capitalism, FDI and Competitiveness comprises 15 of John Dunning’s most widely acknowledged writings on the changing characteristics of the global economy over the past three decades. In particular, it examines how these events have shaped, and been shaped by, the growing internationalization of all forms of business activity.

Chapter 5: Regions, Globalization and the Knowledge-based Economy: The Issues Stated

John H. Dunning

Subjects: business and management, international business


Dunning2 02 chap 5 19/7/02 11:22 am Page 111 5. Regions, globalization and the knowledge-based economy: the issues stated* INTRODUCTION The purpose of this chapter is to offer an analytical framework for evaluating the implications of recent economic events on the spatial distribution of economic activities; and of the role played by multinational enterprises (MNEs)1 and cross-border inter-firm coalitions2 of firms on the international and intranational division of labor. In particular, we shall be concerned with the parallel, yet apparently antithetical, forces towards the geographical dispersion of asset augmenting and asset exploiting activities,3 and the concentration of such activities in limited spatial areas; or what Ann Markusen (1996) has referred to as the paradox of ‘sticky places within slippery space’. The theme of this chapter is of increasing interest to businesses practitioners and to policy makers alike; and to the academic community. To business practitioners, research is revealing that, as the core competencies of firms become more knowledge-intensive, yet more mobile across space, so the choice of location in the production, organization and use of those assets is becoming a more critical competitive advantage.4 To the national or regional policy makers, the challenge is to offer, both to indigenous and foreign-owned firms, the spatially anchored resources and capabilities within their jurisdiction, which are perceived by these firms to be at least as attractive complements to their own ownership specific advantages as those offered by other countries or regions. To the academic scholar, locationally related studies are at...

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