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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 11: The Relationship between the Spatial and Hierarchical Organization of Multiplant Firms: Observations from the Global Semiconductor Industry

Tomokazu Arita and Philip McCann


11. The relationship between the spatial and hierarchical organization of multiplant firms: observations from the global semiconductor industry Tomokazu Arita and Philip McCann University of Tsukuba, Japan and University of Reading, UK 1. INTRODUCTION Over the last decade there has been a significant growth in interest in the geographical behaviour of firms in the electronics and semiconductor industry. In particular, much research has focused on the apparent tendency of successful firms in these sectors to be highly clustered in particular locations (Oakey and Cooper, 1989; Saxenian, 1994; Almeida and Kogut, 1997; Kittiprapas and McCann, 1999). There is a variety of interrelated reasons for this recent research interest, which can broadly be grouped into two themes. The first theme is a general renewal of academic interest in geography and industrial location issues per se, and the second theme is a growth in interest in the particular characteristics of the electronics and semiconductor industry itself. From the point of view of business research, these two themes imply that industrial clustering may provide newly increased possibilities for firms to use location strategies as a means of gaining access to geographically specific technology inputs. Certainly, much recent literature has pointed towards such conclusions for the electronics industry. The work of authors such as Scott (1988), Saxenian (1994), Castells and Hall (1994), and Larsen and Rogers (1984) argues that relative openness to local tacit information exchanges of Silicon Valley firms, many of which are small, allows them to benefit from the positive...

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