Understanding and conceptualizing the complexities of the contemporary global economy is a challenging but vitally important task. In this article, we critically evaluate the potential of one interpretive framework—the global production networks (GPN) perspective—for analysing the global economy and its impacts on territorial development. After situating the approach in relation to other cognate chain/network approaches, the article proceeds to review and evaluate a number of underdeveloped areas that need to be understood and incorporated more fully if the framework is to deliver on its early potential. The article concludes with a consideration of the key research issues facing work in this area.

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Global production networks: realizing the potential

With the aid of an empirical case study of the automobile industry in China, we explore how, under certain political-economic conditions, the investments of transnational corporations (TNCs) can be shaped to meet the state's objectives. We develop the concept of 'obligated embeddedness' to capture the dynamics of this process. We show that foreign direct investment in the automobile industry in China is a type of market-led and embedded investment which is characterised by joint ventures and the follow-up network configurations. However, to achieve such obligated embeddedness on the part of TNCs-and for the state and its citizens to gain its benefits-the state not only has to have the theoretical capacity to control access to assets located within its territory, but also the power actually to determine such access.

Transnational Corporations and ‘Obligated Embeddedness’: Foreign Direct Investment in China's Automobile Industry:

Many fear that the mobility of corporate investment creates a “race to the bottom” in international environmental regulations as firms invest in the countries with the weakest environmental protections. But the relationship between environmental regulation and investment is poorly understood. I hypothesize that intercountry institutional distance and firm environmental capabilities moderate the relationship between the stringency of a country's environmental regulations and firms' investment in that country. Analysis of investment in the international automobile industry supports these hypotheses. Study results suggest that attracting corporate investment and preserving local environmental quality need not be opposing policy objectives.

Does Corporate Investment Drive a “Race to the Bottom” in Environmental Protection? A Reexamination of the Effect of Environmental Regulation on Investment

Introduction: Towards a Critical Political Economy of European Governance PART I: THE NATURE AND LIMITS OF THE EUROPEAN NEOLIBERAL PROJECT The Contradictions of 'Embedded Neoliberalism' and Europe's Multi-level Legitimacy Crisis: the European Project and its Limits B.van Apeldoorn Neoliberal European Governance and the Politics of Welfare State Retrenchment: A Critique of the New Malthusians M.Ryner Geopolitics and Neoliberalism: U.S. Power and the Limits of European Autonomy A.Cafruny PART II: CASE STUDIES OF EUROPEAN SOCIO-ECONOMIC REGULATION Global Finance and the European Economy: The Struggle over Banking Regulation H.-J.Bieling & J.Jager 'New Europeans' for the 'New European Economy': Citizenship and the Lisbon Agenda S.Hager Organic Intellectuals at Work? The High Level Group of Company Law Experts in European Corporate Governance Regulation L.Horn PART III: THE WIDENING OF NEOLIBERAL GOVERNANCE: TRANSNATIONAL CAPITALISM IN CENTRAL AND EASTERN EUROPE Corporate Tax Reform in Neoliberal Europe: East Central Europe as a Template for Deepening the Neoliberal European Integration Project? A.Vliegenthart & H.Overbeek Race to the Bottom? Transnational Companies and Reinforced Competition in the Enlarged European Union D.Bohle The Rise of the Competition State in the Visegrad Four: Internationalization of the State as a Local Project J.Drahokoupil PART IV: CONTESTING NEOLIBERAL GOVERNANCE: RESISTING RESTRUCTURING IN NATIONAL AND TRANSNATIONAL ARENAS A National Case-study of Embedded Neoliberalism and its Limits: The Dutch Political Economy and the 'No' to the European Constitution B.van Apeldoorn Globalization and Regional Integration: The possibilities and Problems for Trade Unions to Resist Neo-liberal Restructuring in Europe A.Bieler

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Contradictions and Limits of Neoliberal European Governance: From Lisbon to Lisbon

Using the case study of Slovakia, this article considers the role of the state in the rapid growth of the automotive industry in integrated peripheral markets of the global automotive industry. Although this growth has been mainly driven by the investment strategies of automotive lead firms, the state has played an important role by accommodating the strategic needs of foreign capital through neoliberal economic policies. In addition to secondary sources, the empirical research is based on a 2010 survey of 299 Slovak-based automotive firms with a response rate of 44% and on 38 on-site firm-level interviews conducted between 2011 and 2013 and one in 2005. The analysis draws upon approaches in economic geography, international political economy and upon global value chains and global production networks perspectives to argue that the successful development of the automotive industry in Slovakia has been achieved at the expense of its overwhelming dependence on foreign capital and corporate capture. The arti...

https://journals.sagepub.com/doi/pdf/10.1177/0969776414557965

Whose success? The state–foreign capital nexus and the development of the automotive industry in Slovakia

The demise of communism triggered large flows of foreign direct investment into Eastern Europe. This article examines the impact of recent changes in the international environment—the transformation of world production systems and the rise of neoliberalism—on bargaining between multinational corporations and post-communist governments. It focuses on the Hungarian automobile industry, one of the region's largest recipients of FDI. The Hungarian case illustrates the ability of small, open, and geopolitically weak states to parlay shifts in the global environment into a bargaining asset. The ascent of lean production heightened pressure on auto MNCs to develop local supplier systems capable of fast delivery of components to East European subsidiaries. The pull of backward integration was particularly strong for Japanese producers, whose non-European status enabled Hungarian state authorities to secure commitments to raising domestic content. Transplanting Japanese-style production in Eastern Europe proved less vexing for European MNCs, whose status as EU-based companies freed them of local-content requirements and whose preexisting supplier networks obviated heavy investments in the Hungarian components industry. But while Western auto producers enjoyed highly favorable terms of entry into Eastern Europe, even they could not elude the paradoxical effects of global changes on MNC/host state relations. The very eastward extension of the European Union's nondiscriminatory rules that facilitated EU-based firms' entry into Hungary also permitted host state authorities to parry efforts by MNCs to obtain particularistic concessions after entry. The Hungarian case thus demonstrates that MNC/host state bargaining in the post-Cold War period hinges more on the global positions of multinationals than on the structural vulnerabilities of capital-importing states ( per dependency theory) or the internal capacity of host states ( per statist theories).

Anna Seleny

Papers

The Political Enforcement of Liberalism: Bargaining, Institutions, and Auto Multinationals in Hungary