Multinationals and Economic Geography

Multinationals and Economic Geography

Location, Technology and Innovation

Simona Iammarino and Philip McCann

After more than fifty years of systematic research on multinational enterprises (MNEs) what is apparent is that there is, as yet, no unified or dominant theory of the MNE. The objective of this book is to bring into focus one particular dimension of MNE behaviour and activity that has been relatively under-researched – namely the geography of the multinational enterprise – as understood through the lens of innovation and technological change. The authors clearly demonstrate that geography is becoming increasingly important for MNEs and, in turn, MNEs are becoming progressively more important for economic geography. The pivot on which this vital relationship turns is the creation, diffusion and management of new knowledge.

Chapter 6: Globalization and multinationals in a historical process

Simona Iammarino and Philip McCann

Subjects: business and management, international business, economics and finance, economics of innovation, international business, regional economics, geography, economic geography, innovation and technology, economics of innovation, urban and regional studies, regional economics


Any discussion dealing with issues relating to globalization faces the problem of what exactly is meant by the term. ‘Globalization’ is used on a daily basis in the popular press and all forms of cultural dialogue, and with regard to almost every social and economic issue we currently face. The term can be interpreted in a variety of different ways, carrying either or both positive and normative connotations, depending in large part on our perceptions and the vantage point from which we are considering these issues. It is not a single phenomenon or process, but a catch-all concept to describe a wide range of forces at work (Steger 2003; MacGillivray 2006). It has been defined very differently according to the social science within which it is applied. Already, almost two decades ago, Paul Streeten (1996) had, half in jest, collected the various definitions in the literature. One largely applied is that provided by Giddens (1990, p. 64): ‘the intensification of world-wide social relations which link distant localities in such a way that local happenings are shaped by events occurring any miles away and vice versa’. Thus, one may think of globalization as a high (and increasing) degree of interdependency and interrelatedness among different and geographically dispersed actors and places. In principle, therefore, there may be a higher level of globalization even keeping constant the level of international transactions and operations. In other words, globalization and internationalization are not perfectly synonymous (Archibugi and Iammarino 1998, 2002; Cantwell and Iammarino 1998).

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