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Clusters and Commodity Chains: Firm Responses to Neoliberalism in Latin America
- Latin American Research Review
- University of Texas Press
- Volume 39, Number 3, 2004
- pp. 243-255
- 10.1353/lar.2004.0047
- Review
- Additional Information
Latin American Research Review 39.3 (2004) 243-255
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Clusters and Commodity Chains:
Firm Responses to Neoliberalism in Latin America
Robert N. Gwynne
Latin America experienced a paradigm shift in both theory and policy during the 1990s. It could be argued that this opened a new chapter in Latin America's evolution, particularly in terms of forming new relations with the world economy (Gwynne and Kay 2000). Following the neostructuralist debate, one important issue today is how competitive advantages can be generated and created—at the scale of both the nation-state and the firm. In this context much has been written on developing competitive advantage in firms and states in the world's core economies (Porter 1998), but relatively little on Latin America. Much of this literature concentrates on high technology sectors (Storper 1997). However, even books that have focused on how to develop competitive advantage in small, resource-based economies have not extended their horizons beyond Scandinavia (Maskell et al. 1998). Therefore, there [End Page 243] would appear to be serious research gaps in the study of a more grounded political economy in Latin America in the early twenty-first century. It could be argued that new conceptualizations are required, particularly in regards to links between governments and firms.
Since the late 1980s most Latin American countries have introduced wide-ranging free-market reforms, liberalized markets, and have opened their economies to the forces of international competition. Now that most of these reforms have been completed, new problems have emerged for which the free-market recipe offers less help. It could be argued that imperfect markets, poor infrastructure, deficient educational systems, and weak governments are making the transition to open and competitive economies very painful (Stiglitz 2002). Many sectors are succumbing to new competitive pressures, and many firms, especially the small and medium-sized enterprises (SMEs), are finding the global marketplace a very hostile territory.
There is a surprising lack of research about how Latin American firms deal with and relate to these new competitive pressures. A number of books (Casaburi 1999; Gereffi et al. 2002; Pietrobelli 1998) have appeared over the last five years, many reflecting the results of a wide variety of case studies of how manufacturing firms have adapted to neoliberal policies in Latin America. This review will not only refer to these but also attempt to set out a framework for further research. It will first examine firm responses to neoliberalism before investigating the relevance of the concepts of commodity chains and clusters—with a particular focus on agro-industrial firms and local development.
Firm Responses to Neoliberalism in Latin America
The character of firms in Latin America has evolved considerably since the implementation of the structural changes linked to the adoption of neoliberal reform in the 1990s. Although the neoliberal reforms did not aim at promoting specific firms, neither were they meant to be neutral. For example, export-oriented firms were supposed to perform better than those geared to domestic markets. Firms within certain sectors were also favored by much greater investment in the postreform period. Thus, in all Latin American countries, firms within the telecommunications sector needed to invest massively in order to modernize during the neoliberal period. In the...
