Flexible Linkages and Offshore Assembly Facilities in Developing Countries

Abstract

The adoption of advanced manufacturing technology and new forms of organization at parent plants has created expectations of spatial reintegration of production toward developed countries. Contrary to these expectations, there has been a flexible spatial decentralization process toward developing countries that is different from the one associated with mass production. While Vernon's product cycle theory hypothesizes that "obsolete" independent units are decentralized, in a flexible production system tightly integrated and increasingly technologically sophisticated units are transferred to developing countries. This trend is the result of changes not only in the production relations within the plant, but also across plants.