Welsh Journals

5. THE DIGITAL VALUE CHAIN AND ECONOMIC TRANSFORMATION: RETHINKING REGIONAL DEVELOPMENT IN THE NEW ECONOMY1 Glyn Williams INTRODUCTION It is claimed that we are entering a period of profound economic change compar- able to the Industrial Revolution. Yet there is a lack of clarity about the nature of this change. Discussion of economic development increasingly tends to frag- ment at a time when integrated multidisciplinarity is the sine qua non of regional development. The new approach leads to demonstrating how lifelong learning relates to the need for the enterprise constantly to adapt, while entrepreneurial- ism, networking and partnership formation or clustering tend to be discussed separately by reference to the need to promote flexible innovation. Similarly dis- cussion of the emergence of the information society lacks discussion of the asso- ciated social change. Few of these discussions give a clear understanding of the specifics of the economic transformation writ large. There is a need for a dis- cussion of the nature of the new economy, the dynamics of its emergence and the implications for socio-economic development in Wales. These comments might appear misplaced, given all of the discussion about Objective 1 and how the associated cash input will transform those regions which can benefit from it. Yet that discussion tends to focus upon the orthodox understanding of economic development, with its focus upon state monetary and financial policy to promote low inflation and constrain public borrowing. What is good for the UK is good for Wales (Welsh Office, 1997). The various 'strategic priorities' are precisely that: priorities devoid of an understanding of what it is that they will create. The claim of a shift to an information society suggests that the entire discus- sion is rooted in an outmoded problematic. The modernist conception of the economy was premised upon the centrality of the state as that which imposed