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Economic geographical theories of both firm and regional development have increasingly placed significance on the sociological aspects of business activity. In particular, debates about clustering, embeddedness, and relational networks have led to an implicit emphasis on face-to-face interaction as a key factor behind more effective explanation of economic activity in the global economy. However, much of the debate around the nature and role of face-to-face interaction has been limited to wider discussions about the forces behind agglomeration, and has not considered how it is important to transnational firms (TNCs) as key global economic actors. Drawing on research into transnationalizing UK-based law firms, this work proposes a theoretical framework for understanding the nature and significance of face-to-face interactions to TNCs. It argues that face-to-face interaction continues to have a crucial role in shaping both firm and industry success or failure in the context of transnationalization. Whilst recognizing that legal services may have specific requirements for face-to-face interaction, the study argues that many of the factors behind its ongoing key significance are likely to be common to TNCs more widely. Thus, this form of economic practice warrants much greater empirical attention in theories of global economic development.

More than ‘managing across borders?’ the complex role of face-to-face interaction in globalizing law firms