Flexible production,electronic linkages,and large firms: evidence from the automobile industry

At the beginning of the 1980s, a reverse trend in local economic development began, supporting old urban industrial areas in whichlarge firms represented the most competitive territorial and industrial systems. Using the case of the automobile industry as an example, this paper argues that contrary to what is anticipated by some researchers, the new flexible organization of the large firm will support neither an asymmetrical relationship of control between spatially decentralized firms nor a spatial reconcentration of activities toward industrialized countries. On the contrary, flexible production will support symmetrical networks that bind together spatially decentralized firms in a web of two-way partnership interactions. As space reflects changes in the organization of production, we anticipate greater coordination and interaction between spaces. This process would not be determined, butfacilitated by electronic linkages through technologies such as international EDI systems and groupware designed to increase cooperative work and joint decision-making.The author is indebted to the Bureau of Business Research in the Graduate School of Business of the University of Texas at Austin and to the Foreign Economic Research Office of the United States Department of Labor in Washington, D.C. for financial support. This paper benefited from helpful comments from an unknown referee.