Contemporary Relationships between Firms in a Classic Industrial Locality: Evidence from the Social Change and Economic Life Initiative

This paper details the historical and contemporary relationships between firms, across a wide spectrum of sectors, in Rochdale, Lancashire. This area was a classic example of an industrial district and the paper aims to examine the present forms of the sub-contracting relation between large and small firms in the light of the current interest in, and advocacy of, a norm of cooperation between firms of varying sizes within geographical areas. A typology of four possible forms of relation is outlined: satellite, active engagement, subordinate cooperation and independent cooperation, and empirical material, drawn from part of the Social Change and Economic Life Initiative of the Economic and Social Research Council, is presented to show how this typology relates to modem Rochdale. Using both case study and survey evidence the paper concludes that there was little sign of any increase in sub-contracting in Rochdale in the 1980s. It was concentrated within the machine making sector of engineering, was a traditional feature of inter-firm relations, and was used as a strategy of last resort. There was evidence that the relations between firms in this locality are becoming less integrated. There was little sign of the much discussed new forms of ties. In Rochdale any coordination of firms was overwhelmingly through external market relationships.