Networks, Governance and Economic Development

Networks, Governance and Economic Development

Bridging Disciplinary Frontiers

Edited by Mari Jose Aranguren Querejeta, Cristina Iturrioz Landart and James R. Wilson

This compact and authoritative book brings together the topical themes of networks and governance to advance understanding of the determinants of local economic development in the context of increasingly global relationships.

Chapter 6: Multinational Networks of Local Production Systems: A Basis for Analysis and Policy

Lisa De Propris, Stefano Menghinello and Roger Sugden

Subjects: economics and finance, regional economics, geography, economic geography, urban and regional studies, clusters, regional economics


Lisa De Propris, Stefano Menghinello and Roger Sugden1 1 INTRODUCTION It can be argued that the ‘competitiveness’ of local production systems depends more and more on their ability to combine embedded and local assets with international sourcing and outsourcing. This means their exploiting the economies generated by co-location and embedded competencies yet their having permeable borders. Further, the internationalization and openness of local production systems might imply the development of strong bridging relationships across localities and indeed across systems, even if this might risk undermining the solidity of intra-systemic bonding relationships, especially when systems rest on strong and embedded socioeconomic linkages imbued with certain forms of trust. In this chapter we consider aspects of the possibility for local production systems to establish production relations with actors outside their locality and, in particular, to create multinational networks of production systems. Our conceptual approach follows, most especially, Sugden (1997) and Cowling and Sugden (1999). They analyse the possibility of multinational networks with respect to a set of interrelated characteristics based partly on a response to the strategic failures of transnational corporations. See also the related contributions on multinational networks in research and learning by Sugden (2004) and by Bailey et al. in Chapter 13 of this volume. A concern with multinational networks should not be read as a sign of the failure of a model of local development based on localized competencies, specialization and embeddedness. On the contrary, it might provide an opportunity to build from and deepen such a model; it...

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