No 2014/7 Exploring the interplay, differences, and commonalities between global production networks and global innovation networks of two multinational companies

Abstract

The recent wave of globalisation has been characterised not only by an increased number of cross-border production networks but also by an increasing number of cross-border innovation networks. However, most literature treats global innovation networks (GINs) as an extension of global production networks (GPNs). Taking a network perspective and based on primary data, this paper explores the composition of and relations between the GPNs and GINs of two multinational companies (MNCs). It finds that the case firms’ GINs and GPNs interplay and the interplay is to a greater extent in the ICT case firm than in the automobile case firm. The case firms’ GINs have more diverse actors and are more centralised than their GPNs but the reason is different in two cases. Meanwhile, the GINs and GPNs share the same relational pattern in both case firms. The paper suggests that theoretically considering GPN and GIN as two different but interwoven layers of a MNCs’ global value creation network may provide better conceptual clarity and may generate more precise implications for practitioners and policymakers.