Article by Henry Farrell: “Dan Wang’s new book, Breakneck: China’s Quest to Engineer the Future, came out last week…The biggest lesson I took from Breakneck was not about China, or the U.S., but the importance of “process knowledge.” That is not a concept that features much in the existing debates about trans-Pacific geopolitics, nor discussions about what America ought do to revitalize its economy. Dan makes a very strong case that it should.
As I’ve said twice, I’m biased. I’m fascinated by process knowledge and manufacturing because I spent a chunk of the late 1990s talking to manufacturers in Bologna and Baden-Wurttemberg for my Ph.D. dissertation.
I was carrying out research in the twilight of a long period of interest in so-called “industrial districts,” small localized regions with lots of small firms engaged in a particular sector of the economy. Paul Krugman’s Geography and Trade (maybe my favorite of his books) talks about some of the economic theory behind this form of concentrated production: economic sociologists and economic geographers had their own arguments. Economists, sociologists and geographers all emphasized the crucial importance of local diffuse knowledge about how to do things in making these economies successful. Such knowledge was in part the product of market interactions, but it wasn’t itself a commodity that could be bought and sold. It was more often tacit: a sense of how to do things, and who best to talk to, which could not easily be articulated. The sociologists were particularly interested in the informal institutions, norms and social practices that held this together. They identified different patterns of local institutional development, which the Communist party in Emilia-Romagna and Tuscany, and the Christian Democrats in the Veneto and Marche, had built on to foster vibrant local economies.
I was interested in Bologna because it had a heavy concentration of small manufacturers of packaging machinery, which could be compared, if you squinted a little, with the bigger and more famous cluster of engineering firms around Stuttgart in Germany. There were myriads of small companies in the unlovely industrial outskirts of Bologna, each with its own particular line of products. Most of these companies had been founded by people who had apprenticed and worked for someone else, spotted their own opportunity to iterate on their knowhow, and gone independent…(More)”.
