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Globalisation, Regions and the State: Exploring the Limitations of Economic Modernisation through Inward Investment

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  • Nicholas A. Phelps

    (School of Geography, University of Leeds, Woodhouse Lane, Leeds, LS2 9JT, UK, n.phelps@geog.leeds.ac.uk)

  • Mark Tewdwr-Jones

    (Bartlett School of Planning, University College London, Wates House, 22 Gordon Street, London, WCIHOQB, UK, m.tewdwr-jones@ucl.ac.uk)

Abstract

Over the past 10 years or so, the UK has witnessed intense interregional competition for a small number of large inward investment projects. These projects, examples of foreign direct investment (FDI) from Far East Asia, have been relied upon by nation-states as panaceas to the economic problems being experienced within older industrial regions. Central government has adopted a non-interventionist approach to FDI and has rather encouraged regional-level institutions of governance to provide innovative and competitive packages of aid to the prospective investors through the creation of customised spaces. By relying on this FDI, local and regional-level institutions within the UK have sought to reduce or eliminate those uncertainties associated with local governance and the planning system that would otherwise face potential investors. We discuss these issues with reference to three case-study FDI examples: LG in South Wales, Samsung in the North East of England and Hyundai in Scotland. These projects provide good examples of the prestige attached to large FDI projects by regional and local agencies: by-passing normal local democratic processes; instigating streamlined institutional processes; and ignoring environmental protection policies to `land' the projects for particular regions. But the collapse of the south-east Asian economies and the recent mothballing of both the Hyundai and LG plants illustrate some very immediate problems regarding the unsustainability of the nation-state both relying on the global market and subordinating local interstices to resolve regional economic problems. Overall, the paper examines how particular state forms and practices operate to privilege certain types of interests and activities at certain scales, and how particular state entities are attempting to capture agendas and decisions at particular scales of governance.

Suggested Citation

  • Nicholas A. Phelps & Mark Tewdwr-Jones, 2001. "Globalisation, Regions and the State: Exploring the Limitations of Economic Modernisation through Inward Investment," Urban Studies, Urban Studies Journal Limited, vol. 38(8), pages 1253-1272, July.
    • Handle: RePEc:sae:urbstu:v:38:y:2001:i:8:p:1253-1272
    DOI: 10.1080/00420980120061016
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    References listed on IDEAS

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    1. N A Phelps & M Tewdwr-Jones, 1998. "Institutional Capacity Building in a Strategic Policy Vacuum: The Case of the Korean Company LG in South Wales," Environment and Planning C, , vol. 16(6), pages 735-755, December.
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    Cited by:

    1. Martijn J. Burger & Bert van der Knaap & Ronald S. Wall, 2013. "Revealed competition for greenfield investments between European regions," Journal of Economic Geography, Oxford University Press, vol. 13(4), pages 619-648, July.
    2. Andrés Rodríguez-Pose & Nicholas Gill, 2003. "The Global Trend towards Devolution and its Implications," Environment and Planning C, , vol. 21(3), pages 333-351, June.
    3. Mike Hodson, 2008. "Old Industrial Regions, Technology, and Innovation: Tensions of Obduracy and Transformation," Environment and Planning A, , vol. 40(5), pages 1057-1075, May.
    4. Aidan While & Andrew E G Jonas & David C Gibbs, 2004. "Unblocking the City? Growth Pressures, Collective Provision, and the Search for New Spaces of Governance in Greater Cambridge, England," Environment and Planning A, , vol. 36(2), pages 279-304, February.
    5. Timothy Dixon & David Adams, 2008. "Housing Supply and Brownfield Regeneration in a post-Barker World: Is There Enough Brownfield Land in England and Scotland?," Urban Studies, Urban Studies Journal Limited, vol. 45(1), pages 115-139, January.
    6. Peter Midmore & Dennis Thomas, 2006. "Regional Self-reliance and Economic Development: The Pembrokeshire Case," Local Economy, London South Bank University, vol. 21(4), pages 391-408, November.

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