Policy Entrepreneurs and FDI Attraction: Canada’s Auto Industry

Abstract

New perspective is provided on a critical period in the development of the Canadian automotive industry. In the 1980s, five foreign manufacturers built new vehicle assembly operations in Canada, effectively transforming that country’s automotive industry. Drawing from a combination of interviews with key actors and a review of archives, this case study makes several contributions. First, gaps are closed in the economic history of one of Canada’s most important industries. Second, the case demonstrates the capacity of using historical perspective to extend an existing theory to a new area of inquiry. In this case, Multiple Streams Theory is employed to explain the process of inward FDI attraction. This includes a description of the role of policy entrepreneurs and their capacity to create and exploit opportunities. Third, the case demonstrates the continuing relevance of integrating historical perspective to contemporary issues in business, management, and public policy.

Shifting patterns in the application of industrial policy

“…Further and related, these cases also demonstrate the primacy of internal, corporate champions in investment attraction. This contrasts with studies of automotive investment attraction from earlier periods, which highlighted new, external sources of investment, as well as influences and influencers external to the firm, including policy, policy makers and policy entrepreneurs (see Molot, 1993;Mordue, 2010Mordue, , 2019Thomas, 2011;Anastakis, 2013). By contrast, without the personal agency of internal corporate champions, the Toyota investment of 2005 and the GM transition that commenced between 2014 and 2016 are improbable.…”

“…Most prevalent in this regard were trade related investment measures (TRIMs), which included local content requirements, ceilings on imports, expectations for local equity participation, and localised R&D (see Alavi and Hasan, 2001;Ofreneo, 2008). Mordue (2019) draws from multiple streams theory (Kingdon, 1984), to explain how Canadian politician, Ed Lumley, performed the role of Kingdon's 'policy entrepreneur' to deploy trade distorting tools to engineer investments in Canada by five automakers during the 1980s. Ultimately, many of these tools were proscribed via a combination of the conclusion of the Uruguay round of GATT in 1994 as well as bilateral and multilateral trade agreements.…”

“…However, Figure 4 shows that during the 2000 to 2005 period, Toyota was struggling to make half of the vehicles it sold in North America in North America. This was a longstanding concern within the company, forged from the trade concerns between North America and Japan dating back to the early 1980s (see Mordue, 2019) and part of what the Toyota North American CEO continues to describe as "our long-term commitment to build more vehicles and components in the markets in which we sell them" (Associated Press, 2017). Meanwhile, pressure was being applied to make a larger manufacturing commitment to Mexico.…”

“…As described, the Toyota case represents a late stage example of the type of investment attraction 'big game' hunting that characterised the practice in earlier periods. Like the situations and circumstances captured by the authors above (e.g., Molot, 1993;Mordue, 2010Mordue, , 2019Thomas, 2011;Anastakis, 2013), for the Toyota investment, programs were devised and tools were enacted to support a targeted company and/or a specific sector: vertical industrial policy. However, unlike the pre-2000 cases captured above, this paper has shown that by the mid 2000s, the influence of policy makers was reduced and the primary advocate was the company's chief executive in Canada.…”

A Study of the Impact of Integrating Artificial Intelligence with the Archival Profession under Data Mining

“…The development of network technology and information services, so that enterprises on the use of archives demand toward the direction of multi-channel, mobile, intelligent development, enterprise archives should adapt to the new use of enterprise demand, toward the transformation of the new business model [3][4]. However, there is a lack of special archival departments and full-time archivists to properly manage the archives; some enterprises with independent archival departments lack professional talents who can cope with the shortage of funds, the impact of network technology, and the constraints of the existing system, and some archival departments with professional archivists have a serious disconnect between the experienced knowledge of archivists and the actual work needs [5][6].…”