Regional Business Systems and the Governance of Foreign Direct Investment in Canada, Spain and the UK

Abstract

This paper examines how governance actors in regional business systems engage with foreign-owned multinational corporations which are present within their territory, in attempts to retain investment and link their regions to global production networks. This is done through a qualitative analysis of policy and practice in six sub-national regions in three advanced industrialized economies (Canada, Spain and the UK), thus permitting both international and intra-national comparisons. We find that while there are broad similarities in the types of governance mechanisms used, there are notable differences in the extent and intensity of forms of market, state and associational governance of foreign direct investment.

These differences partly correspond to broader institutional differences in the nature of business systems, and partly to the socio-political construction of sub-national governance space.