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Knowledge and Innovation in the Indonesian Artisanal Furniture Industry

  • Marina van Geenhuizen

    ()

  • Nurul Indarti

    ()

In developed countries, localized learning in clusters of small and medium-sized firms is seen as beneficial for innovation in these firms. This paper questions whether such a situation is also true for small firms in developing countries. By examining 90 furniture manufacturers in the district of Jepara (Indonesia) we observe knowledge access mainly through one-sided local learning mechanisms, e.g. in-house learning-by-doing and informal contacts with buyers (contractors). This pattern tends to cause a dominance of product innovation (changes in design) and low levels of newness, and points to a lack of advantages from local learning. The major principle behind this is the way in which subcontracting relations are structured. However, the furniture manufacturers in Jepara are willing to connect with global knowledge, but financial obstacles prevent a change. This situation calls for the establishment of centres or renewal of existing centres where global knowledge can be accessed e.g. through the Internet, and support can be given in absorption of the new knowledge.

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File URL: http://www-sre.wu-wien.ac.at/ersa/ersaconfs/ersa06/papers/847.pdf
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Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa06p847.

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Date of creation: Aug 2006
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Handle: RePEc:wiw:wiwrsa:ersa06p847
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  1. Ogawa, Susumu, 1998. "Does sticky information affect the locus of innovation? Evidence from the Japanese convenience-store industry," Research Policy, Elsevier, vol. 26(7-8), pages 777-790, April.
  2. Niels Beerepoot, 2005. "Collective Learning By Artisanal Subcontractors In A Philippine Furniture Cluster," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 96(5), pages 573-584, December.
  3. John Humphrey & Hubert Schmitz, 2002. "How does insertion in global value chains affect upgrading in industrial clusters?," Regional Studies, Taylor & Francis Journals, vol. 36(9), pages 1017-1027.
  4. Gereffi, Gary, 1999. "International trade and industrial upgrading in the apparel commodity chain," Journal of International Economics, Elsevier, vol. 48(1), pages 37-70, June.
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