Geography Reference
In-Depth Information
world already all contain major cities (Collier 2007), whereas poor coun-
tries without any such major cities have great difficulty in achieving rapid
growth.
The arguments and evidence presented in this chapter also indicate
that globally dominant firms will be those which are strongly embedded
in the global city knowledge networks. Similarly, the leading global city-
regions located in both developed and developing economies will be those
which have the strongest presence of such multinational companies. As
we saw in Chapter 2, this is exactly the correspondence between MNEs
and cities that Stephen Hymer first predicted. The various examples
discussed here therefore serve to highlight the difference between simple
'connectedness', defined in terms of the architecture of transport and com-
munications infrastructure, and the much broader concept of 'connectiv-
ity'. Connectivity is a behavioural concept incorporating the capability
of individuals, firms, organizations and institutions to interact, engage,
take initiatives and make decisions across different locations and within
networks, and is a concept showing a substantial degree of two-way open-
ness: openness to 'ideas' (new knowledge), to 'business' (new investment)
and to 'people' (new diversity) (Fagerberg and Srholec 2008). As we have
argued in this topic, global networks and local agglomeration act as com-
plementary forces strengthening each other in determining the 'spikes' of
the world economy.
Following our discussions in Part I of this topic, understanding con-
nectivity is therefore essential in order to make sense of the locational
strategies of MNEs. In the international business and international man-
agement literatures the importance of such connectivity mechanisms is
more or less taken for granted (Dunning 2000), whereas amongst econo-
mists and even geographers there are still many who give little credence to
these issues. The arguments contained in this topic are intended to change
some of these perceptions.
NOTES
1.
It seems useful to remind here that catching up and convergence, although partially
overlapping, are distinct concepts. The first relates to the ability of a country, or a
group of countries, to narrow the gap in productivity and income with the leader
economy. Convergence refers to a trend towards a reduction of the overall productiv-
ity and income differences at the worldwide level. If all countries below the frontier
catch up, convergence will necessarily follow; otherwise, if just some countries catch up
while others fall behind, the outcome with respect to convergence is far from clear. The
huge empirical evidence available shows that, at best, convergence is restricted to some
groups or 'convergence clubs' of national or regional economies (Lall 2004; Fagerberg
and Godinho 2005).
