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You have full access to this open access article. Semi-peripheral economies are reliant on foreign capital for innovation and upgrading into higher-value-added economic activities.
This characteristic of dependent development is coupled with unreliable government support for domestic businesses, resulting in fragmented state-business ties. How then did a local electrical vehicle EV battery startup InoBat manage to build an upgrading alliance in Slovakia and capitalise on the accelerating automotive shift to electromobility despite these barriers being present in the semi-peripheral economy of Slovakia?
By developing a network-based analytical approach and using the unlikely case study of InoBat, this paper argues that developmental entrepreneurship, the mobilisation of private sector resources by venture capital or a large domestic firm, and support by private-public institutions were key determinants for the emergence of the InoBat upgrading alliance.
The findings underline that local firms can also be the drivers of upgrading efforts even in the absence of consistent government support and the heavy presence of large transnational corporations. Semi-peripheral economies are facing many obstacles to upgrading into new industries with higher-value added.
Upgrading strategies require political will and cross-partisan support, broad societal consensus, strong state capacity, and business-government collaboration. These conditions have been shown to be key for developing the institutions that have supported upgrading into high-innovation economic sectors Doner and Schneider ; Amsden ; Chang Semi-peripheral economies, however, lack domestic economic capabilities in mid- to high-technology sectors which are instead dominated by foreign-owned transnational corporations TNCs.