The world’s factory and informal ties – organisation of firm networks in the electronics industry in the Greater Pearl River Delta, China

Meyer Susanne
Additional contact information
Meyer Susanne: Wien

ZFW – Advances in Economic Geography, 2012, vol. 56, issue 1-2, 9-24

Abstract: Institutional transition in countries such as China is expected to go hand in hand with the formalisation of interactional behaviour in firm networks. Recently, however, a different string of arguments has entered the academic discussion emphasising the limited extent of the formalisation of firms’ behaviour despite the institutional transition being complete. The aim of this paper is to show conceptually and empirically that a balance of formal and informal interactions is considered optimal for firms due to economic opportunities resulting from informality. The Greater Pearl River Delta (PRD), where Hong Kong (HK) firms act as cross-border intermediates between global customers and Chinese producers, serves as an example for studying the degree of informality applied when operating in two distinct institutional settings. A survey of electronics firms in HK investigates the way in which firms organise their contacting and selecting as well as their contracting processes when approaching global customers and Chinese producers. The findings show (1) that the degree of informality is greater when interacting with producers in the PRD due to the incompleteness of the institutional setting, but (2) that when acting with global customers, the behaviour of firms is only formalised to a certain extent. Informal interaction also serves as an opportunity for firms and is strategically used in an innovative organisational and management processes.

Keywords: informality; institutions; business organisation; electronics industry; Hong Kong; China; informality; institutions; business organisation; electronics industry; Hong Kong; China (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1515/zfw.2012.0002 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bpj:zfwige:v:56:y:2012:i:1-2:p:9-24:n:2

DOI: 10.1515/zfw.2012.0002

Access Statistics for this article

ZFW – Advances in Economic Geography is currently edited by Harald Bathelt and Sebastian Henn

More articles in ZFW – Advances in Economic Geography from De Gruyter
Bibliographic data for series maintained by Peter Golla ().