The Changing Geography of Wine Production
Edited by Elisa Giuliani, Andrea Morrison and Roberta Rabellotti
Chapter 6: Recombining to Compete: Public–Private Institutions, Shifting Networks and the Remaking of the Argentine Wine Sector
6. Recombining to compete: public– private institutions, shifting networks and the remaking of the Argentine wine sector Gerald A. McDermott and Rafael A. Corredoira 1 INTRODUCTION How can developing countries upgrade their industries to compete in the world? Scholars of international management and economic development have increasingly argued that the attendant ability of local firms to upgrade – combine existing resources in new ways to create new higher-value products – depends in large part on their access to a variety of knowledge resources (Moran and Ghoshal, 1999; Giuliani et al., 2005). But it is less clear what types of institutional infrastructure facilitate such access. A growing current in the innovation literature argues that access to knowledge often depends on whether firms are embedded in rich inter-firm networks, which enable them to build collaborative relationships, gain resources, learn and coordinate experiments (Powell et al., 1996). However, scholars also note how firm practices, social structures and institutions are slow to change and can constrain one’s access to new knowledge resources (Uzzi, 1996). This enabling and constraining nature of embeddedness resonates strongly in emerging market countries (Spicer et al., 2000), and especially in Latin America, where societies are often noted for their weak institutions and social capital (Schneider, 2004). Unfortunately much of the research on development has misinterpreted this dual nature of embeddedness as a function of a society’s immutable stock or endowment of social capital and ‘right’ institutions. For instance, researchers tend to argue that firms fail to learn and adapt because they are...
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