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Regional lock-ins and realities of firm-level diversification

Stihl, Linda LU orcid and Rekers, Josephine V. LU (2025) In Cambridge Journal of Regions, Economy and Society
Abstract
This paper provides micro-level evidence of how and why functional lock-ins persist, despite clear articulations of cognitive un-locking at firm, cluster and regional levels. Theoretically, we draw on literature on regional clusters and vertical value chains to consider how incumbent firms’ efforts to diversify are conditioned by regional lock-ins as well as value chain governance. To investigate the interaction between cognitive and functional unlocking, we employ an extended case study and trace the diversification strategies of 12 incumbent supplier firms in the automotive industry in Olofström (Sweden) from 2000 to 2022, based on annual reports and a set of 25 interviews. Our findings show that regional cognitive unlocking triggered by... (More)
This paper provides micro-level evidence of how and why functional lock-ins persist, despite clear articulations of cognitive un-locking at firm, cluster and regional levels. Theoretically, we draw on literature on regional clusters and vertical value chains to consider how incumbent firms’ efforts to diversify are conditioned by regional lock-ins as well as value chain governance. To investigate the interaction between cognitive and functional unlocking, we employ an extended case study and trace the diversification strategies of 12 incumbent supplier firms in the automotive industry in Olofström (Sweden) from 2000 to 2022, based on annual reports and a set of 25 interviews. Our findings show that regional cognitive unlocking triggered by the 2008 crisis resulted in an increase in diversification strategies by supplier firms, but after 15 years, their dependency on the automotive industry remains high, as does the persistence of functional lock-in, as a product of vertical value chain dynamics. (Less)
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author
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organization
publishing date
type
Contribution to journal
publication status
epub
subject
keywords
Diversification, Lock-ins, Supplier firm, Regional Development, Value Chains, Automotive industry, R11, R58
in
Cambridge Journal of Regions, Economy and Society
publisher
Oxford University Press
ISSN
1752-1378
DOI
10.1093/cjres/rsaf034
language
English
LU publication?
yes
id
5ab444ef-09c0-4442-a5a5-2b164aec50ab
date added to LUP
2025-09-30 15:04:03
date last changed
2025-10-17 09:05:11
@article{5ab444ef-09c0-4442-a5a5-2b164aec50ab,
  abstract     = {{This paper provides micro-level evidence of how and why functional lock-ins persist, despite clear articulations of cognitive un-locking at firm, cluster and regional levels. Theoretically, we draw on literature on regional clusters and vertical value chains to consider how incumbent firms’ efforts to diversify are conditioned by regional lock-ins as well as value chain governance. To investigate the interaction between cognitive and functional unlocking, we employ an extended case study and trace the diversification strategies of 12 incumbent supplier firms in the automotive industry in Olofström (Sweden) from 2000 to 2022, based on annual reports and a set of 25 interviews. Our findings show that regional cognitive unlocking triggered by the 2008 crisis resulted in an increase in diversification strategies by supplier firms, but after 15 years, their dependency on the automotive industry remains high, as does the persistence of functional lock-in, as a product of vertical value chain dynamics.}},
  author       = {{Stihl, Linda and Rekers, Josephine V.}},
  issn         = {{1752-1378}},
  keywords     = {{Diversification; Lock-ins; Supplier firm; Regional Development; Value Chains; Automotive industry; R11; R58}},
  language     = {{eng}},
  month        = {{10}},
  publisher    = {{Oxford University Press}},
  series       = {{Cambridge Journal of Regions, Economy and Society}},
  title        = {{Regional lock-ins and realities of firm-level diversification}},
  url          = {{http://dx.doi.org/10.1093/cjres/rsaf034}},
  doi          = {{10.1093/cjres/rsaf034}},
  year         = {{2025}},
}