Van Egeraat, Chris and Jacobson, David (2005) Geography of Production Linkages in the Irish and Scottish Microcomputer Industry: The Role of Logistics. Economic Geography, 81 (3). pp. 283-303. ISSN 0013-0095
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Abstract
The economic crisis of the mid-1970s marked the transition from the
traditional Fordist mode of industrial organization to one of time-based competition
(TBC). It has been postulated that the rise of TBC will lead to an increase in
local and regional production linkages. Part of the argument is that the associated
search for logistical efficiency and the adoption of the just-in-time (JIT) principles
will lead to closer buyer-supplier proximity. In this article, we test the relevance of
this idea in a case study of the microcomputer hardware industry in Ireland and
Scotland. Most of the data were collected during multiple interviews with subsidiaries
of all global microcomputer assemblers with operations in one of the two countries.
The study shows that rather than sourcing locally or regionally, the assemblers
import the vast majority of their material inputs from regions outside Ireland
and Britain, notably from the Far East, and that the inbound logistics pipelines of
most components involve inventories, often hubbed in local warehouses. Such supply
systems have been interpreted as pseudo-JIT, suboptimal inbound logistics
systems that are organized on traditional Fordist principles. We argue that the logistics
systems and the geography of the supply linkages should not be interpreted
this way. Inbound inventories were tightly managed, leading to modest target buffer
levels and high shipment frequencies. Even under JIT supply, the geographic configuration
of production linkages and the details of logistics systems remain highly
dependent on a range of contextual conditions and component characteristics. The
findings of this study suggest that a strategy of building integrated vertical production
clusters around subsidiaries of multinational enterprises is no longer suitable
for Ireland and Scotland, at least not in the context of the microcomputer industry.
Item Type: | Article |
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Additional Information: | This research is supported in part by the Irish Research Council for the Humanities and Social Sciences and Forfas. We would like to thank Dr. Nick Phelps for his input in the research and two anonymous referees for their constructive comments. |
Keywords: | computer industry; production linkages; logistics; |
Academic Unit: | Faculty of Social Sciences > Geography Faculty of Social Sciences > Research Institutes > National Institute for Regional and Spatial analysis, NIRSA |
Item ID: | 6121 |
Depositing User: | Dr. Chris Van Egeraat |
Date Deposited: | 18 May 2015 15:40 |
Journal or Publication Title: | Economic Geography |
Publisher: | Clark University |
Refereed: | Yes |
Funders: | Irish Research Council for Humanities and Social Sciences (IRCHSS) |
URI: | https://mu.eprints-hosting.org/id/eprint/6121 |
Use Licence: | This item is available under a Creative Commons Attribution Non Commercial Share Alike Licence (CC BY-NC-SA). Details of this licence are available here |
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