Foreign direct investment and renewal of industries: framing the reciprocity between materiality and discourse

ABSTRACT

Informed by the evolutionary literature on economic geography, this paper develops a conceptual framework for analysing the complexity between foreign direct investment (FDI) and renewal of industries. Present contributions tend to explain the impact of FDI on regional industry evolution as a static, output-oriented phenomenon, that is, informed by an instrumental rationale in which the dynamism of FDI and regional industry development is linked to polarization of stagnation/decline vs. growth/development. Opposing this, we argue for an epistemological shift in approach to the reciprocity between FDI and renewal of industries as dynamism between material outcomes and discursive processes. To accomplish this, we build on key concepts and understandings from evolutionary economic geography; review the regional effects of FDI literature and build a framework sensitive to contextual dimensions of FDI. We focus on multinational companies’ practices and material outcomes in terms of regional spillovers and the discursive processes in terms of FDI narratives. This framework is exemplified by data from the salmon farming industry and the subsea industry in Hordaland and the oil and gas industry and the mining industry in Finnmark.

KEYWORDS:

• Foreign direct investment
• regional industry renewal
• regional development
• narratives
• innovation

Acknowledgements

The authors would like to thank Arne Isaksen and the two anonymous reviewers for their helpful comments on previous drafts of this paper.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

This research was made possible by funding from the Research Council of Norway, Hordaland county municipality and Finnmark county municipality.