Abstract

The reorganization of production within firms and the development of interfirm networks are currently much in fashion as elements of competitiveness. An analysis of developing-country experiences suggests that caution is required. Studies of intrafirm reorganization focus unduly on production and tend to assume that rapid improvements will lead to the attainment of international competitiveness. Evidence from Brazil suggests that even after improving performance, the competitiveness gap remains large. Further, an examination of the basis of the success of the East Asian newly industrialized countries shows that Taiwan and Korea diverge in important respects from the new orthodoxy of Just-in-Time and interfirm networking.

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