Angela Garcia Calvo

“Upgrading in Spain: an institutional perspective”

abstract

This paper summarises the main contributions of a book manuscript that aimed to explain the recent rise of Spain’s firms in complex service sectors, and the parallel fall in capital and skill intensive manufacturing sectors through the analysis of the institutional structure that enabled it. I argued that upgrading in Spain’s complex services was enabled by Peer Coordination, a non-hierarchical variant of relational coordination based on public-private interdependencies and direct business-state interactions. PC gave firms in these sectors equivalent advantages to those of other variants of relational coordination but imposed fewer constraints during a crucial period of transformation, facilitating upgrading. However, PC imposed constraints on capital and skill intensive manufacturing sectors that slowed down their transformation. This explains Spain’s lopsided pattern of upgrading.  In exceptional cases, the Central State and some Regional Governments were able to circumvent the limitations derived from PC or to create institutional structures that provided support for some of these manufacturing sectors.