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The emergence of parallel trajectories in the automobile industry: Environmental issues and the creation of new markets

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  • Vallejo, Bertha

    (UNU-MERIT)

Abstract

In the past few years we have witnessed how traditional manufacturing relationships between North and South are rapidly changing and allowing for new forms of interaction. This article suggests that we are facing, on the one hand, a disruption of the traditional markets guided by traditional industries towards the creation of new industries and consequently new markets. The study proposes the co-existence of three, not-yet competing, trajectories: (i) the traditional one between Original Equipment Manufacturers (OEMs) and their subsidiaries in the South, (ii) the emerging South (with China and India) investing and acquiring OEMs from the North, (iii) the race for the development of environmentally friendly technologies, pushed by public policy and promoted by heavy public R&I funding; linked to the promotion by the North of new industries. The implications of the interaction of these trajectories are not yet clear. However, it seems that at least in the current stage of pre-competitive capabilities building, collaboration among firms (in any of its forms) rather than competition is proven to be more efficient in reaching technological mastery. The question of how the South will position itself in the new emerging order is still an open one.

Suggested Citation

  • Vallejo, Bertha, 2015. "The emergence of parallel trajectories in the automobile industry: Environmental issues and the creation of new markets," MERIT Working Papers 2015-037, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    • Handle: RePEc:unm:unumer:2015037
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    Keywords

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    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • L62 - Industrial Organization - - Industry Studies: Manufacturing - - - Automobiles; Other Transportation Equipment; Related Parts and Equipment
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General

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