Upgrading through Integration? The Case of the Central Eastern European Automotive Industry

This paper explores whether there are signs that the automotive industry in selected new European Union member states from Central Eastern Europe was able to upgrade in the wake of economic and political integration. In this context, a broadened understanding of upgrading is brought forward. The evidence presented in this paper suggests that while upgrading in the narrow sense is taking place, serious barriers to upgrading conceptualized in broader theoretical and empirical terms remain. As a broader perspective on upgrading takes the embeddedness of a particular value chain into consideration, this paper suggests that the institutional and regulatory context on the local, national, and regional level structures the international division of labor to a significant extent and thus the upgrading potential.