Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from Manchesterhive.Com at 10/02/2021 08:32:41PM Via Free Access Market Relations and the Competitive Process
Total Page:16
File Type:pdf, Size:1020Kb
Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access Market relations and the competitive process Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access New Dynamics of Innovation and Competition The series New Dynamics of Innovation and Competition, published in asso- ciation with the ESRC Centre for Research in Innovation and Competition at the University of Manchester and UMIST emanates from an engagement of the Centre’s research agenda with a wide range of internationally re- nowned scholars in the field. The series casts new light on the significance of demand and consumption, markets and competition, and the complex inter-organisational basis for innovation processes. The volumes are multi- disciplinary and comparative in perspective. Series editor: Mark Harvey is Senior Research Fellow at CRIC Already published: Innovation by demand: an interdisciplinary approach to the study of demand and its role in innovation Andrew McMeekin, Ken Green, Mark Tomlinson and Vivien Walsh (eds) Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access Market relations and the competitive process edited by Stan Metcalfe Alan Warde Manchester University Press Manchester and New York distributed exclusively in the USA by Palgrave Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access Copyright © Manchester University Press 2002 While copyright in the volume as a whole is vested in Manchester University Press, copyright in individual chapters belongs to their respective authors, and no chapter may be reproduced wholly or in part without the express permission in writing of both author and publisher. Published by Manchester University Press Oxford Road, Manchester M13 9NR, UK and Room 400, 175 Fifth Avenue, New York, NY 10010, USA www.manchesteruniversitypress.co.uk Distributed exclusively in the USA by Palgrave, 175 Fifth Avenue, New York, NY 10010, USA Distributed exclusively in Canada by UBC Press, University of British Columbia, 2029 West Mall, Vancouver BC, Canada V6T 1Z2 British Library Cataloguing-in-publication data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-publication data applied for ISBN 0 7190 6468 6 hardback First published 2002 100908070605040302 10987654321 Typeset in Sabon with Helvetica Neue Condensed (HNC) by Northern Phototypesetting Co. Ltd, Bolton Printed in Great Britain by Biddles Ltd, Guildford and King’s Lynn Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access Contents List of figures and tables page vi List of contributors vii Series foreword viii Introduction Stan Metcalfe and Alan Warde 1 1 On the complexities and limits of market organisation Richard R. Nelson 12 2 Markets, embeddedness and trust: problems of polysemy and idealism Andrew Sayer 41 3 Cognition and markets Brian J. Loasby 58 4 Competition as instituted economic process Mark Harvey 73 5 Markets, materiality and the ‘new economy’ Don Slater 95 6 Between markets, firms and networks: constituting the cultural economy Fran Tonkiss 114 7 Regulatory issues and industrial policy in football Jonathan Michie and Christine Oughton 130 8 The evolution of the UK software market: scale of demand and the role of competences Suma S. Athreye 144 9 Open systems and regional innovation: the resurgence of Route 128 in Massachusetts Michael H. Best 158 Conclusion Stan Metcalfe and Alan Warde 190 Index 209 Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access List of figures and tables Figures 8.1 Breakdown of billings to clients in the UK software sector (1971–87) page 150 9.1 The productivity triad 159 9.2 Cluster growth dynamics 163 9.3 Regional growth and skill formation dynamics 178 9.4 Electrical engineering graduates in Massachusetts 179 Tables 8.1 Sector-wise distribution of computer software and services sales 150 8.2 Rankings of sales to large private sector firms 151 8.3 Sectors of origin of the main competitors 152 8.4 Nationality of the main overseas competitors 152 8.5 Serious competitors faced by UK software and computer services firms 153 8.6 Factors contributing to the competitive advantage of firms 154 8.7 Barriers to the growth of UK software firms 154 8.8 Entry barriers for different types of European software producer 155 9.1 Production systems model 162 9.2 Techno-diversification of Massachusetts’ manufacturers 165 Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access List of contributors Suma S. Athreye Economic Discipline, The Open University Michael H. Best University of Massachusetts at Lowell and Judge Institute of Management Studies, Cambridge University Mark Harvey ESRC Centre for Research on Innovation and Competition, University of Manchester Brian J. Loasby Department of Economics, University of Stirling Jonathan Michie Department of Management, Birkbeck College, University of London Richard R. Nelson School of International and Public Affairs, Columbia University Christine Oughton Department of Management, Birkbeck College, University of London Andrew Sayer Sociology Department, University of Lancaster Don Slater Sociology Department, London School of Economics Fran Tonkiss Sociology Department, Goldsmiths College, University of London Our thanks go to Deborah Woodman and Sharon Dalton for their inestimable contributions to the organisation of the seminar and the preparation of the typescript for this book. Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access Series foreword The CRIC–MUP Series New Dynamics of Innovation and Competition is designed to make an important contribution to this continually expanding field of research and scholarship. As a series of edited volumes, it combines approaches and perspectives developed by CRIC’s own research agenda with those of a wide range of internationally renowned scholars. A distinctive emphasis on processes of economic and social transformation frames the CRIC research programme. Research on the significance of demand and con- sumption, on the empirical and theoretical understanding of competition and markets, and on the complex inter-organisational basis of innovation processes, provides the thematic linkage between the successive volumes of the series. At the interface between the different disciplines of economics, sociology, management studies and geography, the development of economic sociology lends a unifying methodological approach. A strong comparative and historical dimension to the variety of innovation processes in different capitalist economies and societies is supported by the international character of the contributions. The series is based on international workshops hosted by CRIC which have encouraged debate and diversity at the leading edge of innovation studies. CRIC is an ESRC funded research centre based in the University of Man- chester and UMIST. Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access 1 Introduction Stan Metcalfe and Alan Warde There has been increasing interest and debate in recent years on the instituted nature of economic processes in general and the related ideas of the market and the competitive process in particular. This debate lies at the interface between two largely independent disciplines, economics and sociology, and reflects an attempt to bring the two fields of discourse more closely together. In many ways this is to return to a previous age when the study of institutional arrangements was at the centre of the study of capitalism. The contributions to this volume explore this interface in a number of ways. The purpose of this Introduction is to place these contributions in the wider context and briefly to outline the content of the various chapters. We consider the best place to start to be with the analysis of the nature of markets by drawing a distinction between the general market system and particular markets. This inevitably leads us to a discussion of the relation between markets and competition. The central presence of markets in the operation of capitalism should require no comment, although the ‘end of history debate’ has focused our attention on the multiple meanings and ways in which the market system can be organised. While the market may be per- vasive it is not monolithic, and while it may be spreading as the dominant mode of organisation in modern society, it remains the case that substantial areas of activity lie beyond the market. The boundary between the market and the non-market cannot be taken for granted. It is to a degree fluid and reflects the circumstances of time and place. Thus, for example, there is a whole range of economic activity that lies outside the market, as in house- hold production, and there is also serious debate about extending market principles to other spheres including trade in genetic material. The approach we take reflects our view that markets are indissolubly and simultaneously economic and social. As frameworks of norms that provide regularity to behaviour but permit changes in behaviour, they operate at mul- tiple levels thereby constraining the conduct of individuals, groups and organisations. As frameworks, they are continually evolving. They emerge, grow, stabilise and decline, and it is the dynamics of these processes that are Stan Metcalfe and Alan Warde - 9781526137524 Downloaded from manchesterhive.com at 10/02/2021 08:32:41PM via free access 2 Stan Metcalfe and Alan Warde central to our conception of the operation of modern capitalism. Consider the market arrangements for the food industry in the UK. In the last half century they have been transformed irrevocably as the supermarket form has displaced almost entirely a system based on centralised wholesale markets and small retail stores (Harvey et al., 2001).