Beyond Borders: Trade and Networks

In Chaps. 2 and 3 it was shown why neo-Schumpeterian researchers focusing on the operations of systems of innovation have emphasised both the nationally conditioned factors fostering innovation and those elements of the processes of innovation that drive proximity dynamics. It was also shown however, that the innovation literature has been overwhelmingly captured by a paradigm of endogenous capability. Analysis of the literature reveals that it undervalues the significance of the external environment by largely ignoring the scale of extra-cluster linkages and, in particular, being disinterested in the spatial structure of interdependencies, an argument also made by Bunnell and Coe (2001) although they go little further. This chapter explores how a number of different research traditions have investigated both trans-border activities and multi-spatial systems, whether they are connected across intra-national regions or countries. This analysis facilitates a presentation of the linkage aspects of the linked clustering framework suggested here. In doing so, this chapter traverses some diverse academic traditions. Bilateral trade analysis (both neoclassical and neo-Schumpeterian) is considered, especially noting the empirical evidence on the role of international borders and regional boundaries in strongly influencing the strength of trade. The evidence for international inter-connectedness is considered from a broad spectrum of analytical perspectives, including trade theory, global production networks, global commodity chains, global and world cities, and production fragmentation.