Industrial districts and regional development: Limits and possibilities

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Industrial districts and regional development
Limits and possibilities

• Ash Amin
• Kevin Robins

The Governance of Local Production Systems in
Europe Summer Term 2005 Lecturer Dr.
Jürgen R. Grote Presentation Benjamin Teufel
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The authors
Kevin Robins
Ash Amin
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Questions

• Amin Robins criticise the concept of the
  second industrial divide, which is also
  paraphrised by Post Fordism or flexible
  specialisation.
• To what extent do idealising claims about, and
  for, regions like the Third Italy actually stand
  up to scrutiny?
• To what extent do all the new industrial spaces
  derive from the same process?
• Do industrial districts indeed constitute a
  blueprint for the regeneration of local and
  regional economies?

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Industrial Districts

• Sabel (1982) defines industrial districts and
  flexible specialisation are an epochal
  redefinition of markets, technologies, and
  industrial hierarchies
• consequence of the breakdown of fordist mass
  production
• possibility of a third way to economic and
  social development

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Critique by Amin Robins

• Amin Robins admit that there are important
  changes happening, but refuse the claim that
  there is a distinct break with the past.
• According to their view, there are also powerful
  countervailing and competing tendencies towards
  transnational networks and a global space of
  flows.

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Related theories

• The crisis of Fordism is also described by Scott
  and Storpers particular reading of Regulation
  Theory as well as several other schools
• Amin Robins see a great deal of confusion about
  the object of analysis among these approaches.

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Related theories

• Amin Robins refer to them as anti-Fordist
  utopias who promise
• the end of centralisation, concentration,
  massification, and standardisation
• for the benefit of flexibility, diversity and, in
  spatial terms, localism

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Piore Sabel
Michael Piore
Charles Sabel
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Piore Sabels new orthodoxy

• It is the idea of a radical shift from a model of
  industrial development founded on mass production
  to a possible, and even probable, coming era of
  flexible specialisation based on
• flexible technologies
• skilled workers and
• new forms of industrial community

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Piore Sabels new orthodoxy

• Mass markets have become saturated and consumers
  are now demanding specialised and differentiated
  goods to which the mass production system cannot
  respond.
• Flexibly specialised firms are flexible by
  comparison to mass producers, and hence more
  competitive in volatile environments.

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Piore Sabels new orthodoxy

• The more specialised each firm became, the more
  it depended on the success of products
  complementing its own. (Piore/Sabel 1984)
• This comes along with the blurring of hierarchies
  and the growth of external subcontracting
  relations.
• ? encouragement of the region as an integrated
  unit of production.

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Piore Sabels new orthodoxy

• Transition from one technological paradigm to
  another
• great number of prosperous industrial districts
• basis for a new form of national, perhaps even
  international, economy
• ??Amin Robins argue that there has been a
  widespread diffusion of batch and craft
  production during Fordism itself.

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Scott Storper
Allen Scott
Michael Storper
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Scott and Storpers Regulation theory

• Vertical disintegration encourages
  agglomeration, and agglomeration encourages
  vertical disintegration.
• (Scott 1986)
• desire to identify a common underlying system of
  structural dynamics
• again a simple binary opposition between mass
  production and flexibility?

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Empirical scrutiny?

• Amin Robins try to find out if the emergence of
  a hegemonic regime of capitalist accumulation
  stands up to empirical scrutiny in relation to
  Italy.
• For Amin Robins, the Third Italy comes close
  to the concept of the Marshallian industrial
  district.
• Striking locational and organisational
  similarities
• widespread industrialisation of semi-rural areas
  and small towns with very similar social and
  economic structures
•  

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Empirical scrutiny?

• The vast majority of the districts are near small
  agricultural towns and, in contrast to Sabels
  high-tech engineering areas in Emilia, over 50 of
  them produce merely fashionwear or wooden
  furniture.
• similarities in a broader sense
• significant differences between them in terms of
  their origins and their consolidation as
  industrial districts.

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Empirical scrutiny?

• vertical integration of tasks
• insertion of the local economy into a wider
  spatial division of labour.
• flexibility within many Italian areas of recent
  specialisation ability simply to survive and to
  respond to new market signals
• ? Disproval of Piore Sabels theory?

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Empirical scrutiny?

• Conclusion
• There are difficulties associated with the
  widespread empirical application of the term
  Marshallian industrial district.

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Sabels common aspects

• According to Amin Robins, Sabel tries, however,
  to refer to highly different re-emerged economies
  as both unique and the same .
• Common aspects
• co-operation on a flexible basis between small
  specialist firms
• expansion of privately or publicly provided
  collective business services
• development of long-term collaborative relations
  with larger firms inside or outside the
  industrial district.

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Large firm restructuring

• Sabels approach of flexible specialisation
  also mentions a large firm restructuring, which
  is leading to decentralisation strategies that
  are very similar to the organisational and
  spatial structure of the small industrial
  districts.
• ? Universal applicability?

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An ever-present mode of geographical organisation?

• The Post-Fordist approach is too vague to show
  how it is different from Fordism.
• In the early years of localised Fordist
  production complexes there was also a long-term
  collaboration among relatively autonomous
  partners.
• Flexible or specialised production need not
  necessarily signify the pre-eminence of the
  social division of labour or its containment
  within local boundaries.

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Other forms of production systems

• AR identify two other forms of production
  systems which they want to be treated separately
• agglomerations which have pioneered the
  development of new industries (new industrial
  spaces )
• industrial spaces with extensive large firm
  subcontracting (subcontracting complex )
•  

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Other forms of production systems

• New industrial spaces
• division of labour is almost entirely locally
  contained
• production complex is collectively controlled and
  regulated
• Subcontracting complex
• uneven distribution of power
• control ultimately lies in the hands of major
  firms

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Theories of Amin Robins

• internationalisation
• global integration
• The shift towards flexibility and towards
  integration into the local economy is seen as the
  product of only some among many strategies of
  multinational corporations, which are regarded as
  the major force through which our epoch has been
  created.

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Theories of Amin Robins

• Extension of Fordist structures characterized by
  corporate integration instead of corporate
  fragmentation.
• The increasing fragmentation of the productive
  system must not be confused with a fragmentation
  of capital and control. (Martinelli/Schoenberger,
  1989)
• constraint of solidarity ?? competition

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Political implications of AR

• Is macroeconomic an macrosocial regulation
  possible in this environment of intensified and
  increasing, globalised rivalry?
• The latest developments have shown that even
  under heavily internationalised and globally
  integrated circumstances, it is possible for a
  locally networked economy to arise. Where a base
  for such growth exists, local and national
  policies should seek to nurture and consolidate
  it.

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Political implications of AR

• Instead of blanket solutions, AR recommend the
  support of particular areas of expertise or local
  need by deploying organisational strategies which
  build upon already existing structures.
•  
• However, as the role of the nation state becomes
  problematical, AR do not belief that everything
  can be left to local actors.

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Three responses to Amin Robins

• Charles F. Sabel replies
• Michael J. Piore replies
• Michael Storper replies

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Charles F. Sabel replies

• Sabel refers to the work of Amin Robins as an
   awkward amalgam of a contradictory core
  argument.
• Contradictory core argument
• The current process of industrial reorganisations
  creates new forms of organisation with unknown
  political implications, but these new forms can
  be understood with the same categories used to
  explain traditional mass-production firms.

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Charles F. Sabel replies

• The Claims that the economy can only be seen as a
  node within a global economic network and that
  the local economy can any longer be a significant
  category are simply too imprecise.
• ? empirically defensible ?

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Charles F. Sabel replies

• Theoretical problem
• The open question is which persons or groups
  acting under which constraints decide how
  restructuring is to proceed, and how this process
  can be directed.

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Charles F. Sabel replies

• Contradictions in ARs approach
• stressing the openness of the current situation
  
• ??
• objective laws of capitalist development by
  referring to a higher degree of centralisation
  and internationalisation of capital

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Charles F. Sabel replies

• Contradictions in ARs approach
• criticism on a simple binary opposition between
  mass production and flexibility
• ??
• reduction of new forms of industrial organisation
  to the familiar categories of mass production.

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Michael J. Piore replies

• Piore argues that AR illustrate a particular
  characterisation of the second industrial
  divide which has almost no resemblance to the
  argument Piore Sabel developed in their book on
  The Second Industrial Divide.
• He tries to clearify the statements which they
  had made in that book.

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Michael J. Piore replies

• 1. Further development in industrial countries
  might take place either through a revival of mass
  production or through flexible specialisation and
  therefore the approach is not deterministic.
• It attempts to show how an alternative system of
  development (flexible specialisation) can be
  built out of the same institutional forms used
  very differently in mass production.

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Michael J. Piore replies

•  
•  2. The existence of the dynamic regional
  economies of Central Italy is not seen as an
  alternative to mass production but one would have
  to show how such economies would fit together
  into a coherent economic system.
•  

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Michael J. Piore replies

• 3. The second industrial divide is only an
  attempt to resolve the question of organisational
  diversity of the ecomomy. It tries to capture
  structure through the notions of mass production
  and flexible specialisation. According to Piore,
  by their reassertion of diversity, Amin Robins
  make things only more chaotic.

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Michael J. Piore replies

• Piore admits that the postulate of technological
  trajectory they dispose lacks a theoretical
  basis, but this basis cannot be found in Marxist
  class conflict, since in Marxist theories the
  class structure itself derives from technology.

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Michael Storper replies

• Amin Robins try to remould existing evidence
  and theory on industrial change, instead of
  simply directly making their points about the
  social and political effects of this change and
  the fact that many unresolved questions about the
  organisation and geography of contemporary
  production remain.

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Michael Storper replies

• He poses five questions which in his view are
  implicitly raised by Amin Robins.
•  
• What is an industrial district?
• To what extent are flexible production
  agglomeration a widespread, and therefore,
  important phenomenon today?
• Is this phase of industrial development
  significantly different from that of the
  Fordist/mass production period?
• Are flexible production agglomerations changing
  so as to disappear as such?
• What is the basic nature of contemporary
  industrial and geographical change?

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Michael Storper replies

• The logic of the system of Post-Fordism as a
  whole is different from that of mass production
  because
• the production system is much less vertically
  integrated
• the time horizons of the large firm are shorter
  because product development cycles are shorter
• suppliers have developed greater internal
  flexibility and diversified inter-firm linkages
  to minimise their risks on large firms
• as a result of the latter, the supplier firms are
  increasingly developing a wider range of
  products, but within a given domain of
  specialised activity

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Michael Storper replies

• Storper points out that not every unit of every
  production system was once an assembly line and
  is now flexible!
• Amin Robins fail to appreciate that many of the
  most important dimensions are intimately
  dependent on production flexibility and
  agglomeration ? Large firms are not neccessarily
  the destroyer of industrial districts.

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Michael Storper replies

• Amin Robin stress an ever-increasing dominance
  of large firms and a tendency towards a rapid
  elimination of industrial districts.
• ??
• Successful industrial districts, even in the
  nineteeth century, were frequently inserted to a
  high degree into interregional, national, and
  international divisions of labour as well as
  serving geographically extensive markets.

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Michael Storper replies

• There are a lot of questions remaining which in
  Storpers view cannot be answered by referring to
  old presuppositions about capitalist industrial
  development.