Geography Reference
In-Depth Information
5.
Multinationals, variety of
geographies and evolution
5.1 INTRODUCTION
Orthodox economic approaches largely consider both the multinational
firm and the region or local system as
black boxes
whose characteristics,
behaviour and innovative features are determined by exogenous factors.
Conversely, endogenous perspectives, such as those in the management
literature, tend to explain structure and growth mechanisms primarily as
the result of forces which are purely internal to the firm. Hence, neither of
these approaches is per se appropriate for investigating the links between
the external and internal sources of innovation, and the issue 'global
versus local' in the creation of new knowledge. Rather, the structure, fea-
tures, behaviour and evolution of both the MNE and geographical space
need to be considered within the context of their increasing interdepend-
encies and in the light of their interactions between a variety of different
knowledge transfer mechanisms. In the words of Dicken, 'global' and
'local' are not fixed scales; rather, they represent the extreme points of a
dialectical continuum of complex mutual interactions' (Dicken 1994: 103).
This chapter is devoted to integrating the micro-level of the firm - focus-
ing in particular on MNEs' technological capabilities and strategies - and
the meso-level of the regional system or industrial cluster, in order to
explore the new combinations of internal and external sources of innova-
tion in the modern age of globalization. By definition, a cluster is neither
a homogenous entity, nor a static and secluded one. Hence, it will become
apparent that even firms and clusters that are labelled on the basis of
industry-specific characteristics may have very different technological
bases, use different sources of innovation, and display very different evo-
lutionary patterns. This degree of complexity is all the more evident when
considering multi-product and multi-technology firms, such as is the case
with most MNEs, as these are likely to follow a variety of technological
trajectories in multiple locations.
Building on the micro foundations of firm location and innovative
behaviour - as discussed primarily in Chapters 3 and 4 respectively - and
integrating them with the meso perspectives of regional and local industrial
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