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Globalization and competitive strategy in Europe's vulnerable regions: Firm, industry and country effects in labour-intensive industries

Book or journal references : Regional Studies, vol. 38, pp. 1085-1100 (2004).

Author(s) : Clark , G. L. and Palaskas , T. and Tracey , P. and Tsampra , M.

Abstract :

European integration has prompted great interest in the adjustment capacities of small and medium enterprises in regions characterized by high levels of unemployment and lower-than-average incomes. At issue, in these circumstances, is the extent to which economic competitiveness can be enhanced by technological change and the resources of European and national governments. Relying upon the results of a detailed survey of small- and medium-sized firm competitive strategies in selected vulnerable regions across Europe, the paper focuses upon firm adjustment strategies in four labour-intensive industries vulnerable to international competition. It draws together the results of these surveys providing econometric and statistical analyses that demonstrate the commonalities and differences apparent in small- and medium-sized firms' responses to changing market competition. Significant insights were gleaned from the pooling of these data. It is shown that there are statistically significant firm, country and industry effects in competitive strategies. Unlike many other related studies, the derived results are quite consistent across Europe. Furthermore, statistically significant relationships are established between changes in market sales, local employment and the adoption of process-specific technologies. The findings provide robust conclusions about the significance of country and industry determinants of European small and medium enterprises' competitive strategies in relation to the expanding European and global economy. In sum, the paper raises doubts about the value of regional development strategies that rely exclusively upon clusters and geographical embeddedness in the face of globalization.

Keywords :

competitive strategy; firm; industry; country effects ECONOMIC-GEOGRAPHY; SPECIALIZATION; UNEMPLOYMENT; REVENUE; TRADE; SCOPE

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