SMEs in a Globalised World
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SMEs in a Globalised World

Survival and Growth Strategies on Europe’s Geographical Periphery

Edited by Helena Lenihan, Bernadette Andreosso-O’Callaghan and Mark Hart

This insightful book shows how small and medium enterprises (SMEs) from some of the traditionally less dynamic peripheral economies of the ‘old’ EU – namely Ireland, Italy, Portugal and Spain – have responded to the twin challenges of globalisation and industrial restructuring. Through a series of unique case studies the contributing authors discuss how these economies, and in particular the SME sector, can be transformed.
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Chapter 3: Access of Small Firms to Knowledge Networks as a Determinant of Local Economic Development

Miren Larrea, Alazne Mujika and Mari Jose Aranguren

Extract

3. Access of small firms to knowledge networks as a determinant of local economic development Miren Larrea, Alazne Mujika and Mari Jose Aranguren INTRODUCTION Relocation movements in the global context and related local economic processes (Krugman, 1991, 1998; Fujita et al., 2001) have lately raised the interest of researchers and policymakers in Spain. As Myro et al. (2004) and Fernández-Otheo et al. (2007) illustrate, the manufacturing sector in this country – especially the technologically advanced industries – has been affected by disinvestments in the last decade and inward foreign direct investment (FDI) flows have fallen dramatically. While this trend is seen as a threat by most of the policymakers due to the subsequent rise in unemployment rates, it is considered by others as an opportunity to reinforce the knowledge-based economy. Anyway, important asymmetries can be detected in the process. While some firms are positively reacting to the new context, a significant pool of small firms with a strong local focus are losing their traditional markets without being capable of finding potential new ones. Regarding policies delivered in this context, attention has moved from macro to micro policies, through which advantages of clustering and networking are sought. In this sense, national economic performance is explained not just as the result of macro policies, but also as the result of systemic interactions among different local processes. This focuses attention on the regions of Spain, where different policies to help SMEs are being implemented. In this case, the Basque Country is analysed, where industrial...

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