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Industrial Location Economics

Edited by Philip McCann

Because space is not homogenous, economic activities occur in different locations. Understanding the reasons behind this and understanding exactly how industries are spatially organized is the central theme of this book. Industrial Location Economics discusses different aspects of industrial location behaviour from a variety of theoretical and empirical perspectives. Each of the analytical traditions provides insights into the nature of industrial location behaviour and the factors which can influence it.
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Chapter 10: The Technological Relationships between Indigenous Firms and Foreign-owned MNCs in the European Regions

John Cantwell and Simona Iammarino


10. The technological relationships between indigenous firms and foreignowned MNCs in the European regions John Cantwell and Simona Iammarino University of Reading, UK and University of Rome ‘La Sapienza’ and IAI, Italy 1. INTRODUCTION The nexus between global and local processes has been investigated quite extensively by the literature of the most recent years. One crucial aspect of such a relationship lies in the creation and diffusion of innovation, which, more than other economic processes, shows rather complex patterns of distribution across space. Indeed, as emphasized by Dicken, ‘“global” and “local” are not fixed scales; rather, they represent the extreme points of a dialectical continuum of complex mutual interactions’ (Dicken, 1994, p. 103). As a consequence, neither the orthodox approach – which traditionally considers both the (multinational) firm and the local system as black boxes whose behaviours are determined by exogenous factors – nor an entirely endogenous perspective – which tends to explain structure and growth mechanisms as the result of purely internal forces – seem appropriate to investigate the issue ‘global versus local’. Rather, structure and behaviour of the two ‘extreme points’ need to be considered within the context of their increasing interdependence, including both endogenous determinants and exogenous variables relevant to the analysis. The aim of this chapter is to examine how the particular corporate technological trajectories of multinational corporations (MNCs) have interacted with spatially specific resources for the creation of new competence in some of the leading regions in the European Union. In order to consolidate existing competences, it is...

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