Automotive industry and blurring systemic borders: The role of regional policy measures

The management of cognitive, organisational and geographical interfaces is a major competitiveness challenge for the automotive industry. Market and network imperfections, like underinvestment in innovation, or finance and labour market suboptimalities, are notorious obstacles in this regard. It is argued that the capacity of regional policies to help the industry overcome such failures will be critical for automotive localities to ride the wave of ongoing integration of IT components and functions into automotive conjoints. This paper focuses on the policy actions that can be undertaken at regional level in dealing with blurring sectoral and technological borders to the automotive industry. After developing a conceptual framework for analysis, two empirical cases are reviewed. The primary research results stress the relevance of regional policy action in supporting automotive complexes to overcome market and network failures in order to marry IT and automotive realms more productively. Copyright

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