Digital Information Systems and Global Flagship Networks : How Mobile is Knowledge in the Global Network Economy?

Two defining elements of the “global network economy” are the evolution of global flagship networks (GFNs) and the increasing use of digital information systems (DIS) to manage these networks. Both transformations may gradually reduce constraints to cross-border knowledge diffusion, and hence enhance the mobility of knowledge. We thus need to reconsider and amend the proposition, formalized by agglomeration and innovation economists and network sociologists, that knowledge is less mobile than markets, finance or production facilities. As a first step towards an appreciative theory, the paper explores how distinctive features of GFNs (concentrated dispersion and hierarchical integration) that are enhanced by DIS, shape international knowledge diffusion. We highlight opportunities, pressures and incentives that may result from network participation, and explore how they affect the absorptive capacity of local network suppliers