Saturday, February 27, 2016

Regional Advantage: Culture and Competition in Silicon Valley and Route 128 - AnnaLee Saxenian

I just finished reading this book by AnnaLee Saxenian! This was the first time I was reading a book that compares two of the regions I have been reading about in my coursework as part of the PhD program. Annalee builds an interesting argument which I could relate with closely to the time frame she has described in the book with the shift in the perspective in academics too.

When O. Williamson was building his theory of the transaction cost economics early in the 1970, the world around him was speaking about the large monolithic organization. The question asked was thus - which activities would the venture internalize (vertically integrated) and which of these activities would not be integrated. When the dominance of these large firms in the upcoming technology sectors, was challenges - the question that Annalee raises is gains prominence. What has lead the Route 128 based firms to loose their predominance, while the firms in the silicon valley successfully adapted to the change in the situation around them.

She theorizes the role of the network form of organization, the role played by the underlying social network which helped manage the interdependencies and accelerated movement of relevant information from learning that the members in the network developed.

I love this book not just for the insights it generated from the evolution of the two regions, but also for the underlying mechanisms that were she gets to the fore.
If you are interested in understanding the evolution of these innovation clusters this is a good book to start with. Read it!

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