IDEAS home Printed from https://ideas.repec.org/a/eee/tefoso/v174y2022ics004016252100682x.html
   My bibliography  Save this article

Developing local industries and global value chains: The case of offshore wind

Author

Listed:
  • van der Loos, Adriaan
  • Langeveld, Rowan
  • Hekkert, Marko
  • Negro, Simona
  • Truffer, Bernhard

Abstract

Renewable energy sectors are becoming increasingly globalized with lead firms appropriating value on a global scale: This creates challenges for nations seeking to anchor some of the value locally through indigenous industrial development. Since lead firms select their suppliers for a given deployment project, national governments can set incentives for these firms to opt for local suppliers. We use the case of offshore wind in Europe to quantitatively measure the origin of suppliers across three global value chain governance modes: market, modular and relational. Suppliers can originate from the windfarm country, the lead firm's country or the global market. We test supplier selection across the modes of governance, domestic market size and local content push using a database of over 12,000 supplier contracts. The results indicate that lead firms mostly draw from the global market for market-coordinated segments, while favoring local suppliers under local content regulations. Local lead firms have a higher tendency to source locally for both market and relationally coordinated suppliers. However, local content push reduces the tendency of local lead firms to select local relational suppliers. Therefore, local content requirements seem to be broadly successful to stimulate locally sourced suppliers of the market-coordinated type; on the other hand, our results show that national governments should have local lead firms commission projects without imposing local content regulations to increase the odds that local relational suppliers are selected.

Suggested Citation

  • van der Loos, Adriaan & Langeveld, Rowan & Hekkert, Marko & Negro, Simona & Truffer, Bernhard, 2022. "Developing local industries and global value chains: The case of offshore wind," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    • Handle: RePEc:eee:tefoso:v:174:y:2022:i:c:s004016252100682x
    DOI: 10.1016/j.techfore.2021.121248
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S004016252100682X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.techfore.2021.121248?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Charles L. Munson & Meir J. Rosenblatt, 1997. "The Impact Of Local Content Rules On Global Sourcing Decisions," Production and Operations Management, Production and Operations Management Society, vol. 6(3), pages 277-290, September.
    2. Poulsen, Thomas & Lema, Rasmus, 2017. "Is the supply chain ready for the green transformation? The case of offshore wind logistics," Renewable and Sustainable Energy Reviews, Elsevier, vol. 73(C), pages 758-771.
    3. Marcel Bednarz & Tom Broekel, 2020. "Pulled or pushed? The spatial diffusion of wind energy between local demand and supply," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 29(4), pages 893-916.
    4. Jan Fagerberg & Bengt-Åke Lundvall & Martin Srholec, 2018. "Global Value Chains, National Innovation Systems and Economic Development," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 30(3), pages 533-556, July.
    5. Bento, Nuno & Fontes, Margarida, 2015. "The construction of a new technological innovation system in a follower country: Wind energy in Portugal," Technological Forecasting and Social Change, Elsevier, vol. 99(C), pages 197-210.
    6. Dedecca, João Gorenstein & Hakvoort, Rudi A. & Ortt, J. Roland, 2016. "Market strategies for offshore wind in Europe: A development and diffusion perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 66(C), pages 286-296.
    7. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
    8. Pietrobelli, Carlo & Rabellotti, Roberta, 2011. "Global Value Chains Meet Innovation Systems: Are There Learning Opportunities for Developing Countries?," World Development, Elsevier, vol. 39(7), pages 1261-1269, July.
    9. Unknown, 2016. "Energy for Sustainable Development," Conference Proceedings 253270, Guru Arjan Dev Institute of Development Studies (IDSAsr).
    10. Stine Haakonsson & Julia Kirch Kirkegaard & Rasmus Lema, 2020. "The decomposition of innovation in Europe and China’s catch-up in wind power technology: the role of KIBS," European Planning Studies, Taylor & Francis Journals, vol. 28(11), pages 2174-2192, November.
    11. Hufbauer,Gary C. & Meléndez-Ortiz,Ricardo & Samans,Richard (ed.), 2016. "The Law and Economics of a Sustainable Energy Trade Agreement," Cambridge Books, Cambridge University Press, number 9781107092860, November.
    12. Coenen, Lars & Benneworth, Paul & Truffer, Bernhard, 2012. "Toward a spatial perspective on sustainability transitions," Research Policy, Elsevier, vol. 41(6), pages 968-979.
    13. Lewis, Joanna I. & Wiser, Ryan H., 2007. "Fostering a renewable energy technology industry: An international comparison of wind industry policy support mechanisms," Energy Policy, Elsevier, vol. 35(3), pages 1844-1857, March.
    14. Sovacool, Benjamin K. & Enevoldsen, Peter, 2015. "One style to build them all: Corporate culture and innovation in the offshore wind industry," Energy Policy, Elsevier, vol. 86(C), pages 402-415.
    15. Nassimbeni, Guido, 2006. "International sourcing: Empirical evidence from a sample of Italian firms," International Journal of Production Economics, Elsevier, vol. 103(2), pages 694-706, October.
    16. van der Loos, Adriaan & Normann, Håkon E. & Hanson, Jens & Hekkert, Marko P., 2021. "The co-evolution of innovation systems and context: Offshore wind in Norway and the Netherlands," Renewable and Sustainable Energy Reviews, Elsevier, vol. 138(C).
    17. Markus Steen & Gard Hopsdal Hansen, 2014. "Same Sea, Different Ponds: Cross-Sectorial Knowledge Spillovers in the North Sea," European Planning Studies, Taylor & Francis Journals, vol. 22(10), pages 2030-2049, October.
    18. Peters, Michael & Schneider, Malte & Griesshaber, Tobias & Hoffmann, Volker H., 2012. "The impact of technology-push and demand-pull policies on technical change – Does the locus of policies matter?," Research Policy, Elsevier, vol. 41(8), pages 1296-1308.
    19. Binz, Christian & Truffer, Bernhard, 2017. "Global Innovation Systems—A conceptual framework for innovation dynamics in transnational contexts," Research Policy, Elsevier, vol. 46(7), pages 1284-1298.
    20. Susan Christopherson & Jennifer Clark, 2007. "Power in Firm Networks: What it Means for Regional Innovation Systems," Regional Studies, Taylor & Francis Journals, vol. 41(9), pages 1223-1236.
    21. Musiolik, Jörg & Markard, Jochen, 2011. "Creating and shaping innovation systems: Formal networks in the innovation system for stationary fuel cells in Germany," Energy Policy, Elsevier, vol. 39(4), pages 1909-1922, April.
    22. Yeniyurt, Sengun & Henke, John W. & Cavusgil, Erin, 2013. "Integrating global and local procurement for superior supplier working relations," International Business Review, Elsevier, vol. 22(2), pages 351-362.
    23. Nemet, Gregory F., 2009. "Demand-pull, technology-push, and government-led incentives for non-incremental technical change," Research Policy, Elsevier, vol. 38(5), pages 700-709, June.
    24. Kern, Florian & Smith, Adrian & Shaw, Chris & Raven, Rob & Verhees, Bram, 2014. "From laggard to leader: Explaining offshore wind developments in the UK," Energy Policy, Elsevier, vol. 69(C), pages 635-646.
    25. Ron Boschma, 2005. "Proximity and Innovation: A Critical Assessment," Regional Studies, Taylor & Francis Journals, vol. 39(1), pages 61-74.
    26. Hyundo Choi, 2018. "Technology-push and demand-pull factors in emerging sectors: evidence from the electric vehicle market," Industry and Innovation, Taylor & Francis Journals, vol. 25(7), pages 655-674, August.
    27. Fuenfschilling, Lea & Binz, Christian, 2018. "Global socio-technical regimes," Research Policy, Elsevier, vol. 47(4), pages 735-749.
    28. Fabio Landini & Rasmus Lema & Franco Malerba, 2020. "Demand-led catch-up: a history-friendly model of latecomer development in the global green economy," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 29(5), pages 1297-1318.
    29. Stefano Ponte & Timothy Sturgeon, 2014. "Explaining governance in global value chains: A modular theory-building effort," Review of International Political Economy, Taylor & Francis Journals, vol. 21(1), pages 195-223, February.
    30. Binz, Christian & Truffer, Bernhard & Coenen, Lars, 2014. "Why space matters in technological innovation systems—Mapping global knowledge dynamics of membrane bioreactor technology," Research Policy, Elsevier, vol. 43(1), pages 138-155.
    31. Florian Kern & Adrian Smith & Chris Shaw & Rob Raven & Bram Verhees, 2014. "From laggard to leader: Explaining offshore wind developments in the UK," SPRU Working Paper Series 2014-02, SPRU - Science Policy Research Unit, University of Sussex Business School.
    32. Aitziber Elola & Mario Davide Parrilli & Roberta Rabellotti, 2013. "The Resilience of Clusters in the Context of Increasing Globalization: The Basque Wind Energy Value Chain," European Planning Studies, Taylor & Francis Journals, vol. 21(7), pages 989-1006, July.
    33. Markard, Jochen, 2020. "The life cycle of technological innovation systems," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    34. Ulrich Dewald & Bernhard Truffer, 2011. "Market Formation in Technological Innovation Systems—Diffusion of Photovoltaic Applications in Germany," Industry and Innovation, Taylor & Francis Journals, vol. 18(3), pages 285-300.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gumber, Anurag & Zana, Riccardo & Steffen, Bjarne, 2024. "A global analysis of renewable energy project commissioning timelines," Applied Energy, Elsevier, vol. 358(C).
    2. Doblinger, Claudia & Surana, Kavita & Li, Deyu & Hultman, Nathan & Anadón, Laura Díaz, 2022. "How do global manufacturing shifts affect long-term clean energy innovation? A study of wind energy suppliers," Research Policy, Elsevier, vol. 51(7).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Tsouri, Maria & Hanson, Jens & Normann, Håkon Endresen, 2021. "Does participation in knowledge networks facilitate market access in global innovation systems? The case of offshore wind," Research Policy, Elsevier, vol. 50(5).
    2. Stephan, Annegret & Schmidt, Tobias S. & Bening, Catharina R. & Hoffmann, Volker H., 2017. "The sectoral configuration of technological innovation systems: Patterns of knowledge development and diffusion in the lithium-ion battery technology in Japan," Research Policy, Elsevier, vol. 46(4), pages 709-723.
    3. Malhotra, Abhishek & Schmidt, Tobias S. & Huenteler, Joern, 2019. "The role of inter-sectoral learning in knowledge development and diffusion: Case studies on three clean energy technologies," Technological Forecasting and Social Change, Elsevier, vol. 146(C), pages 464-487.
    4. Jonas Heiberg & Bernhard Truffer, 2021. "The emergence of a global innovation system – a case study from the water sector," GEIST - Geography of Innovation and Sustainability Transitions 2021(09), GEIST Working Paper Series.
    5. Binz, Christian & Truffer, Bernhard, 2017. "Global Innovation Systems—A conceptual framework for innovation dynamics in transnational contexts," Research Policy, Elsevier, vol. 46(7), pages 1284-1298.
    6. Barnikol, Julian & Liefner, Ingo, 2022. "The prospects of advanced frugal innovations in different economies," Technology in Society, Elsevier, vol. 71(C).
    7. Rohe, Sebastian & Oltmer, Marie & Wolter, Hendrik & Gmeiner, Nina & Tschersich , Julia, 2022. "Forever Niche: Why do organic vegetable varieties not diffuse?," Papers in Innovation Studies 2022/8, Lund University, CIRCLE - Centre for Innovation Research.
    8. Yap, Xiao-Shan & Truffer, Bernhard, 2019. "Shaping selection environments for industrial catch-up and sustainability transitions: A systemic perspective on endogenizing windows of opportunity," Research Policy, Elsevier, vol. 48(4), pages 1030-1047.
    9. Heiberg, Jonas & Truffer, Bernhard & Binz, Christian, 2022. "Assessing transitions through socio-technical configuration analysis – a methodological framework and a case study in the water sector," Research Policy, Elsevier, vol. 51(1).
    10. Schaube, P. & Ise, A. & Clementi, L., 2022. "Distributed photovoltaic generation in Argentina: An analysis based on the technical innovation system framework," Technology in Society, Elsevier, vol. 68(C).
    11. Doblinger, Claudia & Surana, Kavita & Li, Deyu & Hultman, Nathan & Anadón, Laura Díaz, 2022. "How do global manufacturing shifts affect long-term clean energy innovation? A study of wind energy suppliers," Research Policy, Elsevier, vol. 51(7).
    12. Ron Boschma, 2021. "Global Value Chains from an Evolutionary Economic Geography perspective: a research agenda," Papers in Evolutionary Economic Geography (PEEG) 2134, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Nov 2021.
    13. Marlene O’Sullivan, 2020. "Industrial life cycle: relevance of national markets in the development of new industries for energy technologies – the case of wind energy," Journal of Evolutionary Economics, Springer, vol. 30(4), pages 1063-1107, September.
    14. Dahesh, Mehran Badin & Tabarsa, Gholamali & Zandieh, Mostafa & Hamidizadeh, Mohammadreza, 2020. "Reviewing the intellectual structure and evolution of the innovation systems approach: A social network analysis," Technology in Society, Elsevier, vol. 63(C).
    15. Markard, Jochen, 2020. "The life cycle of technological innovation systems," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    16. De Oliveira, Luiz Gustavo Silva & Negro, Simona O., 2019. "Contextual structures and interaction dynamics in the Brazilian Biogas Innovation System," Renewable and Sustainable Energy Reviews, Elsevier, vol. 107(C), pages 462-481.
    17. Hipp, Ann & Binz, Christian, 2020. "Firm survival in complex value chains and global innovation systems: Evidence from solar photovoltaics," Research Policy, Elsevier, vol. 49(1).
    18. Bento, Nuno & Fontes, Margarida, 2015. "The construction of a new technological innovation system in a follower country: Wind energy in Portugal," Technological Forecasting and Social Change, Elsevier, vol. 99(C), pages 197-210.
    19. C. Sillig & G. Marletto, 2022. "Global influence and national diversity in socio-technical transitions: a sectoral taxonomy," Working Paper CRENoS 202203, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    20. Weidenfeld, Adi & Makkonen, Teemu & Clifton, Nick, 2021. "From interregional knowledge networks to systems," Technological Forecasting and Social Change, Elsevier, vol. 171(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:tefoso:v:174:y:2022:i:c:s004016252100682x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.sciencedirect.com/science/journal/00401625 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.