Global Production, National Institutions, and Skill Formation

Abstract

This book examines the political economy of skill formation and discusses the implications of skill systems for the development of middle-income countries (MICs). While it has been argued that skills are critical for continuous and inclusive development of MICs, there has been no extensive research on the skill systems of MICs. The book addresses this gap. It studies how the national and global dynamics interact and influence skill systems in Mexico and Turkey, two key MICs. It examines how the governance structures in global auto parts-automotive chains (AACs) and national institutions in Mexico and Turkey affect the hiring, training, and employee-development practices of supplier firms from these countries (i.e. skilling strategies), and the outcomes of these practices for firms and workers. The book offers a multilevel analysis, which includes a study of macro-level national institutions, macro/meso-level AAC governance structures, and firm-level skilling practices. The research in the book relies on extensive primary data, which include face-to-face semistructured interviews with representatives of supplier firms from the two countries, and policymakers, experts, and representatives of labour unions and business associations. The book suggests that the state plays the main role in skill systems. Although global AACs put pressures on suppliers, these pressures are filtered by national institutions that are shaped by the state. The skill systems with higher state involvement are more accessible for workers and smaller firms. Therefore, the book argues that skill systems with higher state involvement are more likely to promote high-road development in MICs.