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The limits of guanxi capitalism: transnational collaboration between Taiwan and the USA


  • Jinn-Yuh Hsu
  • AnnaLee Saxenian


In this research we explore the relationship between high-technology regional development and ethnic networks in the connection between Silicon Valley, California and Hsinchu, Taiwan. We elaborate the argument that regional industrial structure and embedded social networks, rather than the multinational firm, should be the focus in the study of transnational business. The complementary regional industrial structures allow economic and technological collaboration between these two regions while the social networks help coordinate these transnational (cross-regional) collaborations. However, we seek to distinguish this account from the dominant perceptions of the role of guanxi (interpersonal relationships) in overseas Chinese business networks (OCBN). In contrast with the arguments for OCBN, that guanxi provides resources for Chinese firms to coordinate and control transnational business, we argue that the skill and competence required for technological upgrading are not necessarily guaranteed within the ethnic network. Although ethnic networks facilitate transnational business and technology cross-fertilization, it seems go too far to argue the Silicon Valley - Hsinchu connection is another version of Chinese guanxi capitalism.

Suggested Citation

  • Jinn-Yuh Hsu & AnnaLee Saxenian, 2000. "The limits of guanxi capitalism: transnational collaboration between Taiwan and the USA," Environment and Planning A, Pion Ltd, London, vol. 32(11), pages 1991-2005, November.
  • Handle: RePEc:pio:envira:v:32:y:2000:i:11:p:1991-2005

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    2. Fu Wenying & Schiller Daniel & Diez Javier Revilla, 2012. "Strategies of using social proximity and organizational proximity in product innovation," Zeitschrift für Wirtschaftsgeographie, De Gruyter, vol. 56(1-2), pages 80-96, October.
    3. Isabel Diez-Vial & Angeles Montoro-Sanchez, 2017. "Research evolution in science parks and incubators: foundations and new trends," Scientometrics, Springer;Akadémiai Kiadó, vol. 110(3), pages 1243-1272, March.
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    5. Ben Spigel, 2013. "Bourdieuian approaches to the geography of entrepreneurial cultures," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 25(9-10), pages 804-818, December.
    6. Bas Karreman & Martijn J. Burger & Frank G. van Oort, 2016. "Location Choices of Chinese Multinationals in Europe: The Role of Overseas Communities," Tinbergen Institute Discussion Papers 16-078/VII, Tinbergen Institute.
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    10. McNally Christopher A, 2011. "China's Changing Guanxi Capitalism: Private Entrepreneurs between Leninist Control and Relentless Accumulation," Business and Politics, De Gruyter, vol. 13(2), pages 1-31, August.
    11. Chung, Henry F.L. & Tung, Rosalie L., 2013. "Immigrant social networks and foreign entry: Australia and New Zealand firms in the European Union and Greater China," International Business Review, Elsevier, vol. 22(1), pages 18-31.

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