Boundaries of Firms and Catching Up by Latecomers in Global Production Networks: The Case of a Mexican Auto-Parts Manufacturer

Discussion Papers

No.492

by HOSHINO Taeko

February 2015

ABSTRACT

For manufacturing firms in developing countries, there are high barriers to entry and to catching up with competitors in their global production networks (GPNs). This paper examines the case of a Mexican auto-parts manufacturer that succeeded in catching up in the automotive GPN. The author proposes that the door to GPNs is open thanks to frequent changes in the boundaries of firms, and also stresses the importance of the necessary conditions that generate opportunities, including institutional settings that facilitate market entry and catching up, and capability building by firms hopeful of entry.

Keywords: boundary of firms, global production network (GPN), automobile industry, auto-parts, ISI, export industrialization, Mexico, Nemak, Alfa, Ford
JEL classification: L22, L52, L62, N66, N86, O33

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