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Global production networks and the changing geography of innovation systems. Implications for developing countries

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  • Dieter Ernst

Abstract

The paper addresses disruptive changes that globalization imposes on the geography of innovation systems, and identifies potential benefits that developing countries could reap from international linkages. The analysis is centered on three propositions. First, developing countries need to blend diverse international and domestic sources of knowledge to compensate for initially weak national production and innovation systems. Second, a greater variety of international knowledge linkages is possible, as globalization reduces the spatial stickiness of innovation. Third, globalization has culminated in an important organizational innovation: the spread of global production networks (GPN) combines concentrated dispersion with systemic integration, creating new opportunities for international knowledge diffusion. We argue that GPN provide firms and industrial districts in developing countries with new opportunities for reverse knowledge outsourcing. We explore resultant challenges that define the need for public policy response, define the new agenda for industrial upgrading, and discuss what types of policies and support institutions may help to reap the benefits from network participation.

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  • Dieter Ernst, 2002. "Global production networks and the changing geography of innovation systems. Implications for developing countries," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 11(6), pages 497-523.
  • Handle: RePEc:taf:ecinnt:v:11:y:2002:i:6:p:497-523 DOI: 10.1080/10438590214341
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    References listed on IDEAS

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    1. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth through Creative Destruction," Econometrica, Econometric Society, pages 323-351.
    2. Dieter Ernst, 1998. "High-Tech competition puzzles - How globalization affects firm behavior and market structure in the electronics industry," Revue d'Économie Industrielle, Programme National Persée, vol. 85(1), pages 9-30.
    3. David J. TEECE, 2008. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," World Scientific Book Chapters,in: The Transfer And Licensing Of Know-How And Intellectual Property Understanding the Multinational Enterprise in the Modern World, chapter 5, pages 67-87 World Scientific Publishing Co. Pte. Ltd..
    4. Best, Michael H, 1999. "Regional Growth Dynamics: A Capabilities Perspective," Contributions to Political Economy, Oxford University Press, vol. 18(0), pages 105-119.
    5. Dieter Ernst, 2000. "Inter-Organizational Knowledge Outsourcing: What Permits Small Taiwanese Firms to Compete in the Computer Industry?," Economics Study Area Working Papers 01, East-West Center, Economics Study Area.
    6. Ernst, Dieter, 1997. "Partners For The China Circle? The Asian Production Networks Of Japanese Electronics Firms," UCAIS Berkeley Roundtable on the International Economy, Working Paper Series qt5215p84k, UCAIS Berkeley Roundtable on the International Economy, UC Berkeley.
    7. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, pages 630-640.
    8. Teece, David J. & Rumelt, Richard & Dosi, Giovanni & Winter, Sidney, 1994. "Understanding corporate coherence : Theory and evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 23(1), pages 1-30, January.
    9. Pari Patel & Keith Pavitt, 1991. "Large Firms in the Production of the World’s Technology: An Important Case of “Non-Globalisation”," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, pages 1-21.
    10. Anthony Bartzokas & Morris Teubal, 2002. "The Political Economy Of Innovation Policy Implementation In Developing Countries," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 11(4-5), pages 271-274.
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