Location, Control and Innovation in Knowledge-Intensive Industries

Published on Jul 21, 2008in Journal of Economic Geography3.359
· DOI :10.1093/jeg/lbn024
Ram Mudambi44
Estimated H-index: 44
(TU: Temple University)
The rising share of intangibles in economies worldwide highlights the crucial role of knowledge-intensive and creative industries in current and future wealth generation. The recognition of this trend has led to intense competition in these industries. At the micro-level, firms from both advanced and emerging economies are globally dispersing their value chains to control costs and leverage capabilities. The geography of innovation is the outcome of a dynamic process whereby firms from emerging economies strive to catch-up with advanced economy competitors, creating strong pressures for continued innovation. However, two distinct strategies can be discerned with regard to the control of the value chain. A vertical integration strategy emphasizes taking advantage of ‘linkage economies’ whereby controlling multiple value chain activities enhances the efficiency and effectiveness of each one of them. In contrast, a specialization strategy focuses on identifying and controlling the creative heart of the value chain, while outsourcing all other activities. The global mobile handset industry is used as the template to illustrate the theory.
  • References (97)
  • Citations (537)
📖 Papers frequently viewed together
334 Citations
565 Citations
2,432 Citations
78% of Scinapse members use related papers. After signing in, all features are FREE.
A Wall Street Journal and Businessweek bestseller. Named by Fast Company as one of the most influential leadership books in its Leadership Hall of Fame. An innovation classic. From Steve Jobs to Jeff Bezos, Clay Christensens work continues to underpin todays most innovative leaders and organizations. The bestselling classic on disruptive innovation, by renowned author Clayton M. Christensen. His work is cited by the worlds best-known thought leaders, from Steve Jobs to Malcolm Gladwell. In this ...
4,940 Citations
#1John HowkinsH-Index: 1
Britain makes more money from music than from its car industry. In the United States the core copyright industries achieved foreign sales and exports of $60.18 billion - a figure which surpasses, for the first time, every other export sector, including automobiles, agriculture and aircraft. Howkins sets out to explore how we can harness creativity and the industry it sustains to our common interests. This book is not about information and the information society. It is about more basic matters, ...
721 Citations
#1John H. DunningH-Index: 64
#2Sarianna M. LundanH-Index: 15
This is the second edition of the celebrated volume by Professor John H. Dunning, first published in 1993, which has now been not only updated but also enriched with the addition of a number of new topics. This addition was not least due to the expertise of the co-author, Sarianna Lundan, in the institutional aspects of international business and the internal governance of transnational corporations (TNCs). It is a comprehensive synthesis of all the theories in International Business based on ex...
4,241 CitationsSource
#1Nicholas A. Phelps (UCL: University College London)H-Index: 29
Phelps N. A. Cluster or capture? Manufacturing foreign direct investment, external economies and agglomeration, Regional Studies. This paper reviews the nature and significance of external economies associated with multinational enterprise (MNE) participation in the manufacturing industries of host economies. It argues that the balance of forces of internalization and externalization is currently skewed towards the former and the interests of MNEs rather than the latter and the interests of loca...
69 CitationsSource
#1Jennifer A. Marrone (SU: Seattle University)H-Index: 6
#2Paul E. Tesluk (UMD: University of Maryland, College Park)H-Index: 30
Last. Jay B. Carson (SMU: Southern Methodist University)H-Index: 4
view all 3 authors...
We adopt a multilevel approach to a paradox that arises when research findings on the performance benefits of team boundary spanning are juxtaposed with earlier work demonstrating the role overload of individuals who span boundaries. Results revealed that individual and team-level factors predicted member boundary-spanning behavior, which increases individual role overload, which then negatively impacts team viability. However, when we aggregated to the team level of analysis, higher levels of b...
193 CitationsSource
During the past decade, the Hollywood studios have broadly sought to subdue, rather than explore, the technological possibilities of the Internet. Specifically, the studios have used their ownership of creative works to control the speed and direction of innovation in an emerging digitally networked social and economic environment, which is built upon the Internet and an ecology of hardware and software technologies. In this paper, I use a relational perspective to examine two critical aspects o...
22 CitationsSource
#1Jan Vang-Lauridsen (AAU: Aalborg University)H-Index: 20
#2Cristina Chaminade (Lund University)H-Index: 22
This paper discusses the importance of global-local linkages for the development of indigenous production in cultural clusters by analyzing the interplay between the indigenous film production cluster in Toronto, Canada, and Hollywood's runaway productions. Global-local linkages are at the forefront of the current debate in cluster studies, the discussion has so far had only a limited impact on the research on cultural clusters. The paper identifies the limitations to the dominant cluster models...
49 CitationsSource
#1Heli Koski (Aalto University)H-Index: 5
#2Tobias Kretschmer (LMU: Ludwig Maximilian University of Munich)H-Index: 19
We document the evolution of product innovation and features in the mobile telephone handset market. We distinguish between two types of product innovation: vertical and horizontal innovation. Using data on mobile telephone handsets from 1990 to 2003, we study the emergence of a dominant design in vertical and horizontal innovations and find that, while vertical product characteristics converged to some extent, no dominant design emerged. For horizontal product characteristics, some horizontal i...
40 CitationsSource
#1Roger J. Calantone (SPbU: Saint Petersburg State University)H-Index: 66
#2Michael A. Stanko (SPbU: Saint Petersburg State University)H-Index: 12
The outsourcing of innovation has been on the rise for years, but research in this area lags behind industry practice. Interviews with managers and a theory base grounded in transaction cost analysis are used to guide the development of an exploratory model that details potential drivers of the outsourcing of innovation activities. Using industry-level data, the proposed model is partially tested using two distinct regression analyses that reveal significant effects both contemporaneously and pe...
121 CitationsSource
The term national system of innovation has been around for more than 20 years and today it has become widely spread among policy makers as well as among scholars all over the world. This paper takes stock and looks ahead from a somewhat personal point of view. It also gives some insight into how and why the concept came about. The paper argues that a key to progress is to get a better understanding of knowledge and learning as the basis for innovation and to understand how different modes of inn...
723 CitationsSource
Cited By537
This article first introduces the concept, the rationale, the causes and the genesis of global value chains from a worldwide perspective in the form of a brief overview. In the second empirical section, a closer look is taken at the intermediate trade integration in the EU. In particular, the employment effects of the intermediate trade connections for each EU member state and for selected sectors are highlighted. In the concluding section, it is explained why global value chains are particularl...
#1Eric KnightH-Index: 10
#2Vikas Kumar (USYD: University of Sydney)H-Index: 29
Last. Phillip O'NeillH-Index: 17
view all 4 authors...
#2Rinaldo EvangelistaH-Index: 24
Last. Maria SavonaH-Index: 20
view all 4 authors...
Abstract Technological advancement is an important instrument for economic and technological development, but most countries receive the benefits of innovation and new technologies through technology transfer. Previous studies typically consider direct linkages in order to understand technological advancement without paying much attention to indirect linkages, such as the inter-connectivity of the recipients of Foreign Direct Investment (FDI). To understand the relationship between FDI and techn...
#1Harald Bathelt (U of T: University of Toronto)H-Index: 27
#2Peng-Fei Li (HEC Montréal)H-Index: 5
Abstract Two classic perspectives of knowledge generation across space can be distinguished: one that focuses on localized knowledge networks in communities or clusters and another that investigates how innovation is linked to global knowledge networks of multinational enterprises. The former view has been prevalent in economic geography, the latter in international business. By integrating both perspectives, this paper focuses on the processes of how firms extend their knowledge networks from l...
#1Fabienne Fortanier (De Nederlandsche Bank)
#1Fabienne Fortanier (De Nederlandsche Bank)H-Index: 6
Last. Niccolò Pisani (UvA: University of Amsterdam)H-Index: 5
view all 4 authors...
The growing interest in global value chains (GVCs) has been paired with a greater appreciation of the need for better measurement methods, as reflected by recent initiatives from academia and leading international organizations. This research note focuses on one method to measure GVCs that has been recommended in recent scholarly work, namely input–output models, but goes beyond the industry level of analysis by introducing intra-industry firm heterogeneity. Our illustrative application to multi...
1 CitationsSource