Geography, Learning, and Convergence

According to an increasingly accepted view, the sovereignty of national economies has been eroded to the point where nation-states ‘have become little more than bit actors’ (Ohmae 1995: 12). With the development of globalized financial markets, the rising power of multinational corporations (MNCs), and the emergence of a new set of supranational institutions to govern economic processes on a continental or world scale, nation-states are said to have lost the ability to manage their own domestic economic affairs, having ceded control over exchange rates, investment, and even fiscal policy to extra-national forces (Strange 1997). Moreover, with the increasing leverage and reach of MNCs further contributing to the erosion of national economic sovereignty, the once distinctive character of particular national industrial ‘models’ is said to be under imminent threat. While it may still be possible to identify at least three clearly distinctive national models—an Anglo-American model, a Rhineland (German) model, and a Japanese model—the decline of national institutions, the intensification of competitive forces on a global scale, and the cross-penetration of national markets by MNCs are said to have propelled a process of convergence between these different national models (see Martin and Sunley 1997 for a review of these arguments). In most representations of this globalization dynamic, convergence is regarded as inexorable. One of the most important processes underpinning this dynamic is learning. At the global level, large corporate actors are allegedly learning from each other, so that the most successful corporate practices are emulated and diffused cross-nationally at an increasingly rapid pace. In the late 1980s and early 1990s, considerable attention was devoted to the diffusion of methods of production and workplace organization perfected by Japanese producers of cars and consumer electronics, in which American, Canadian, and European manufacturers were shown to be learning methods such as just-in-time, kaizen/continuous improvement, and other aspects of ‘lean production’ techniques from their Japanese competitors (Womack, Jones, and Roos 1990). With the resurgence of the United States’ economy in the second half of the 1990s, American practices have apparently become the object of global firms’ affections, with large corporations in Europe and Asia adopting the core characteristics of US-style ‘shareholder capitalism’: especially flexible labour market practices, ‘re-engineering’, and the empowerment of shareholders (The Economist 1996a; 1996b).