Local, global and virtual buzz: The importance of face-to-face contact in economic interaction and possibilities to go beyond

Abstract

Novel information and communication technologies have created new possibilities for transferring information and knowledge over distance. Although this might open up broad options for economic interaction, knowledge regarding the effects of these changes on the geographies of production and innovation is still incomplete. Under these circumstances, permanent co-location and face-to-face (F2F) interaction may be efficient in some contexts but not in others. Support by computer-mediated communication (CMC), temporary, and virtual interaction is increasingly becoming the basis for establishing trans-local production networks. By combining results from social psychology with economic geography, it is argued that there is no generally superior spatial fix for economic interaction. Different spatial configurations can be advantageous in different production and innovation contexts, even over large distances without permanent or even regular F2F contact. This paper systematically investigates the effects of new communication technologies and different organisational forms for economic interaction by emphasizing the potential of combining CMC with forms of temporary and permanent F2F interaction.