The Business Services Sector in Central and Eastern Europe. Territorial Embeddedness, Human Capital, and Growing Complexity

• Authors: Geodecki Tomasz , Zawicki Marcin
• Languages of publication: EN

Abstracts

EN

This special issue focuses on territorial embeddedness and growth prospects for the fast-growing Business Services Sector (BSS) in Central and Eastern European (CEE) economies. In this editorial, we introduce the topic of the special issue and outline the dimensions of territorial embeddedness of the Foreign Direct Investment (FDI) in the sector in question, taking into account the risk of relocation and the linkages between investors and local contractors. With regard to development perspectives, we draw on theory and empirical research in the field of industrial upgrading. The contributions to this special issue include six selected articles that deal with the territorial embeddedness of the business services sector in CEE, the role of human capital, the increasing complexity of services provided by this sector, office location factors, labour costs in the region, as well as the prospects of integrating the neighbouring Ukrainian economy into global value chains.

• Publisher: Uniwersytet Ekonomiczny w Krakowie, Małopolska Szkoła Administracji Publicznej
• Journal: Zarządzanie Publiczne / Public Governance
• Year: 2021
• Issue: 2(56)
• Pages: 5-14

Contributors

author

Geodecki Tomasz

• Cracow University of Economics, Department of Public Policies

author

Zawicki Marcin

• Cracow University of Economics, Department of Public Policies

References

• ABSL (2020). EMEA’s Business Services Landscape: A snapshot of 18 countries in the region. ABSL.
• Amsden, A. H. (2001). The Rise of “the Rest”: Challenges to the West from Late-Industrializing Economies. Oxford Scholarship Online.
• Antràs, P., & Yeaple, S. R. (2014). Multinational firms and the structure of international trade. Handbook of International Economics, 4, 55–130.
• Astrov, V., Holzner, M., Leitner, S., Mara, I., Podkaminer, L., & Rezai, A. (2019). Wage developments in the Central and Eastern European EU member states. wiiw Research Report.
• Bair, J. (2005). Global capitalism and commodity chains: Looking back, going forward. Competition & Change, 9(2), 153–180.
• Baldwin, R. (2012). Global supply chains: Why they emerged, why they matter, and where they are going CEPR Discussion Papers 9103. Discussion Papers: CEPR.
• Baldwin, R. (2019). The Globotics Upheaval: Globalization, Robotics, and the Future of Work. Oxford University Press.
• Baldwin, R., & Lopez‐Gonzalez, J. (2015). Supplychain trade: A portrait of global patterns and several testable hypotheses. The World Economy, 38(11), 1682–1721.
• Białynicki-Birula, P., & Pacut, A. (2020). The determinants of territorial embeddedness of offshoring and outsourcing firms: A conceptualisation of the problem. In Ł. Mamica (Ed.), Outsourcing in European Emerging Economies: Territorial Embeddedness and Global Business Services (pp. 28–37). Routledge.
• Brynjolfsson, E., & McAfee, A. (2014). The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies. WW Norton & Company.
• Buch, C. M., Kleinert, J., Lipponer, A., Toubal, F., & Baldwin, R. (2005). Determinants and effects of foreign direct investment: Evidence from German firm-level data. Economic Policy, 20(41), 52–110. https://doi.org/10.1111/j.1468-0327.2005.00133.x
• Bykova, A., Grieveson, R., Hanzl-Weiss, D., Hunya, G., Korpar, N., Podkaminer, L., Stehrer, R., & Stöllinger, R. (2021). Avoiding a Trap and Embracing the Megatrends: Proposals for a New Growth Model in EU-CEE. Wiiw Research Report no. 458.
• Coe, N. M., & Yeung, H. W.-C. (2015). Global Production Networks: Theorizing Economic Development in an Interconnected World. Oxford University Press.
• Collier, P., & Venables, A. J. (2007). Rethinking trade preferences: How Africa can diversify its exports. World Economy, 30(8), 1326–1345.
• Dicken, P. (2015). Global Shift: Mapping the Changing Contours of the World Economy. 7th Edition. Guilford Press.
• Domański, B., & Gwosdz, K. (2009). Toward a more embedded production system? Automotive supply networks and localized capabilities in Poland. Growth and Change, 40(3), 452–482.
• Dunning, J. H. (1977). Trade, Location of Economic Activity and the MNE: A Search for an Eclectic Approach. In B. Ohlin, P.-O. Hasselborn, & P. M. Wijkman (Eds.), The International Allocation of Economic Activity (pp. 395–418). Palgrave Macmillan.
• Dunning, J. H. (2000). The eclectic paradigm as an envelope for economic and business theories of MNE activity. International Business Review, 9(2), 163–190. https://doi.org/10.1016/S0969-5931(99)00035-9.
• Fernandez-Stark, K., Bamber, P., & Gereffi, G. (2011). The offshore services value chain: Upgrading trajectories in developing countries. International Journal of Technological Learning, Innovation and Development, 4(1–3), 206–234.
• Fernandez-Stark, K., & Gereffi, G. (Eds.). (2010). The Offshore Services Global Value Chain. Center on Globalization, Governance & Competitiveness, Duke University.
• Gál, Z., & Marciniak, R. (2020). Budapest: The development and specific features of outsourcing, offshoring and the global business services sector. In Ł. Mamica (Ed.), Outsourcing in European Emerging Economies: Territorial Embeddedness and Global Business Services (pp. 98–113). Routledge.
• Geodecki, T. (2020). The development of European business services value chains: The perspective of emerging economies. In Ł. Mamica (Ed.), Outsourcing in European Emerging Economies: Territorial Embeddedness and Global Business Services (pp. 66–84). Routledge.
• Gereffi, G. (1999). International trade and industrial upgrading in the apparel commodity chain. Journal of International Economics, 48(1), 37–70.
• Gereffi, G., Humphrey, J., & Sturgeon, T. (2005). The governance of global value chains. Review of International Political Economy, 12(1), 78–104. https://doi.org/10.1080/09692290500049805.
• Grabher, G., & Stark, D. (1997). Restructuring Networks in Post-Socialism: Legacies, Linkages and Localities. Clarendon Press.
• Grodzicki, M. J., & Geodecki, T. (2016). New dimensions of core-periphery relations in an economically integrated Europe: The role of global value chains. Eastern European Economics, 54(5), 377–404.
• Grossman, G. M., & Rossi-Hansberg, E. (2006). The rise of offshoring: It’s not more wine for cloth anymore. In Symposium The New Economic Geography: Effects and Policy Implications. Jackson Hole, Wyoming, August 2016.
• Grossman, G. M., & Rossi-Hansberg, E. (2008). Trading tasks: A simple theory of offshoring. American Economic Review, 98(5), 1978–1997.
• Gupta, S., Puranam, P., & Srikanth, K. (2006). Services sourcing in the banking and financial services industries. Exploding Myths and Describing Emerging Best Practice, Report on Study Conducted Jointly with The Capital Markets Company (Capco, London Business School), London: The Capital Markets Company NV and London Business School.
• Hagemejer, J., & Ghodsi, M. (2017). Up or down the value chain? A comparative analysis of the GVC position of the economies of the new EU member states. Central European Economic Journal, 1(48), 19–36.
• Hardy, J. (1998). Cathedrals in the Desert? Transnationals, Corporate Strategy and Locality in Wrocław. Regional Studies, 32(7), 639–652.
• Hardy, J., & Hollinshead, G. (2011). The embeddedness of software development in the Ukraine: An offshoring country perspective. European Planning Studies, 19(9), 1633–1650.
• Hardy, J., Micek, G., & Capik, P. (2011). Upgrading Local Economies in Central and Eastern Europe? The Role of Business Service Foreign Direct Investment in the Knowledge Economy. Taylor & Francis.
• Henderson, J., Dicken, P., Hess, M., Coe, N., & Yeung, H. W.-C. (2002). Global production networks and the analysis of economic development. Review of International Political Economy, 9(3), 436–464.
• Hess, M. (2004). ‘Spatial’ relationships? Towards a reconceptualization of embeddedness. Progress in Human Geography, 28(2), 165–186.
• Hidalgo, C. A., & Hausmann, R. (2009). The building blocks of economic complexity. Proceedings of the National Academy of Sciences, 106(26), 10570–10575.
• Hirschman, A. O. (1958). The Strategy of Economic Development. Yale Studies in Economics: Vol. 10. Yale University Press.
• Jones, R. W., & Kierzkowski, H. (1990). The Role of Services in Production and International Trade: A Theoretical Framework. In J. R. Winthrop (Ed.), The Political Economy of International Trade: Essays in Honor of Robert E. Baldwin (pp. 31–48). Blackwell.
• Koopman, R., Powers, W., Wang, Z., & Wei, S.-J. (2010). Give credit where credit is due: Tracing value added in global production chains. National Bureau of Economic Research.
• List, F. (1909 [1841]). The National System of Political Economy. Longmans, Green & Co.
• Mamica, Ł. (2020). Outsourcing in European Emerging Economies: Territorial Embeddedness and Global Business Services. Routledge.
• Markusen, J. R. (2005). Modeling the offshoring of whitecollar services: From comparative advantage to the new theories of trade and FDI. National Bureau of Economic Research Cambridge, Mass., USA.
• Mazur-Bubak, M. (2020). Impact sourcing: Theoretical analysis in relation to corporate social responsibility in a globalised market. In Ł. Mamica (Ed.), Outsourcing in European Emerging Economies: Territorial Embeddedness and Global Business Services (pp. 52–65). Routledge.
• Micek, G., Działek, J., & Górecki, J. (2010). Centra usług w Krakowie i ich relacje z otoczeniem lokalnym. Wydawnictwo Uniwersytetu Jagiellońskiego.
• Micek, G., Działek, J., & Górecki, J. (2011). The discourse and realities of offshore business services to Kraków. European Planning Studies, 19(9), 1651–1668.
• Milberg, W., & Winkler, D. (2013). Outsourcing Economics: Global Value Chains in Capitalist Development. Cambridge University Press.
• Moe, N. B., Šmite, D., Hanssen, G. K., & Barney, H. (2014). From offshore outsourcing to insourcing and partnerships: Four failed outsourcing attempts. Empirical Software Engineering, 19(5), 1225–1258.
• Morrar, R. (2014). Innovation in services: A literature review. Technology Innovation Management Review, 4(4), Article 4.
• Narula, R., & Pineli, A. (2017). Multinational Enterprises and Economic Development in Host Countries: What We Know and What We Don’t Know. In G. Giorgioni (Ed.), Development Finance: Challenges and Opportunities (pp. 147–188). Palgrave.
• Nölke, A., & Vliegenthart, A. (2009). Enlarging the varieties of capitalism: The emergence of dependent market economies in East Central Europe. World Politics, 61(4), 670–702.
• OECD (2021). Guide to OECD’s Trade in Value Added Indicators (2021 Edition). OECD Publishing.
• Pavlínek, P. (1998). Foreign direct investment in the Czech Republic. The Professional Geographer, 50(1), 71–85.
• Pavlínek, P. (2017). Dependent Growth: Foreign Investment and the Development of the Automotive Industry in East-Central Europe. Springer.
• Pietrobelli, C., & Rabellotti, R. (2011). Global value chains meet innovation systems: Are there learning opportunities for developing countries? World Development, 39(7), 1261–1269.
• Porter, M. E. (1985). Competitive Advantage: Creating and Sustaining Superior Performance. Free Press.
• Radło, M.-J. (2016). Offshoring, Outsourcing and Production Fragmentation: Linking Macroeconomic and Micro-/Business Perspectives. Palgrave Macmillan.
• Rebelo, E. M. (2011). Urban planning in office markets: A methodological approach. Land Use Policy, 28(1), 83–95.
• Sass, M., & Fifekova, M. (2011). Offshoring and outsourcing business services to Central and Eastern Europe: Some empirical and conceptual considerations. European Planning Studies, 19(9), 1593–1609.
• Schröder, J. (2020). Decoupling of labour productivity growth from median wage growth in Central and Eastern Europe. wiiw Research Report.
• Sirilli, G., & Evangelista, R. (1998). Technological innovation in services and manufacturing: Results from Italian surveys. Research Policy, 27(9), 881–899.
• Stehrer, R., & Stöllinger, R. (2015). The Central European Manufacturin Core: What is Driving Regional Production Sharing? FIW Research Reports.
• Stöllinger, R. (2021). Testing the smile curve: Functional specialisation and value creation in GVCs. Structural Change and Economic Dynamics, 56, 93–116.
• Stryjakiewicz, T. (2007). GlaxoSmithKline: Regional and local networking in a post-communist economy. In Wever, E., & Pellenbarg, P. (Eds.), International Business Geography: Case Studies of Corporate Firms (pp. 276–291). Routledge.
• Timmer, M., Miroudot, S., & de Vries, G. (2019). What Countries Do When Exporting: Measuring Functional Specialization in Trade. VoxEU. Org, 1.
• Timmer, M. P., Dietzenbacher, E., Los, B., Stehrer, R., & De Vries, G. J. (2015). An illustrated user guide to the world input-output database: The case of global automotive production. Review of International Economics, 23(3), 575–605.
• Wade, R. H. (2018). The developmental state: Dead or alive? Development and Change, 49(2), 518–546. Wallerstein, I. (1974). The Modern World-System, In: Capitalist Agriculture and the Origins of the European World-Economy in the Sixteenth Century. With a New Prologue. Academic Press.
• Wallerstein, I. (2004). World-Systems Analysis. Duke University Press.
• Wirtz, J., Tuzovic, S., & Ehret, M. (2015). Global business services: Increasing specialization and integration of the world economy as drivers of economic growth. Journal of Service Management, 26(4), 565–587.
• Zawicki, M. (2020). The degree of embeddedness of the business process outsourcing sector in the Visegrad Group in the context of its current development trends and case study findings. In Ł. Mamica (Ed.), Outsourcing in European Emerging Economies: Territorial Embeddedness and Global Business Services (pp. 142–152). Routledge.

Identifiers

DOI

https://doi.org/10.15678/ZP.2021.56.2.01