Global value chains and the role of MNEs in local production systems

Drawing on detailed studies of different industries and countries, Local Clusters in Global Value Chains shows the co-evolutionary trajectories of clusters and GVCs, and the role of firms and their strategies in organizing manufacturing and innovation activities in the context of ongoing technological shifts. The book explores the tension between place-based variables and global drivers of change, and the possibility for territories containing such clusters to prosper in the new global scenario. By adopting insights from the GVC framework and management studies, the book discusses how the internationalization strategies of firms create opportunities as well as constraints for adaptive upgrading in clusters. The chapter analyses the relationship between the internationalization processes undertaken by manufacturing firms located in industrial districts (IDs) and their home-based local assets. It investigates how multinational enterprises (MNEs) could foster the sustainability of assets traditionally present in IDs by being embedded in GVCs. Through a multiple case study of Italian MNEs located in district areas, the research provides empirical evidence for why local companies that have developed in the global market still locate their main activities in district areas, and how MNEs might trigger positive externalities and nourish local assets by jointly engaging in global and local connections. This work concludes by highlighting policy issues.