The geographic component of production technology


Steenhuis, Harm-Jan and Bruijn, Erik J. de (2005) The geographic component of production technology. In: 1st International Conference on Operations and Supply Chain Management, 2005, Bali, Indonesia.

open access
Abstract:In today’s global economy manufacturing companies are continuously re-evaluating their
location. In many instances companies decide to relocate some or all of their
manufacturing activities to so called low labor cost countries. However, the perception that
this is cost effective is not always correct. In many instances the costs of producing in low
labor cost countries are highly under estimated. In some instances the costs of the
production alone, i.e. excluding logistics cost, are already higher than producing in so
called high labor cost countries. Previous research suggests that some of the reasons for
these higher costs are related to the particular geographic environment. This study is
focused on increasing our understanding of the relationship between geographically
determined factors and production technology. Understanding the relationship between
geographical factors and production factors allows insight into production location and
companies may learn to avoid wrongly moving production away from the developed, high
labor cost, countries. For governments; knowledge on geographically determined factors
places governments in a better position to selectively nurture specific industries based on
their geography-production technology relationship
Item Type:Conference or Workshop Item
Faculty of Behavioural, Management and Social sciences (BMS)
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