Abstract
AbstractThis article analyses how the private governance of global value chains (GVCs) varies across multiple end-markets. This is explored through a two-stage mixed-methods analysis of Kenya’s participation in leather value chains serving Europe, China, India and the COMESA region. We first draw on transaction-level customs data to analyse private governance in terms of the stability of buyer–supplier interactions and presence of intermediaries. We then interrogate these results through supplier interviews. Our article highlights the combined role of product specifications and trust in shaping private governance, and heterogeneity of GVCs across the global North and South, as well as within the South. It further questions commonly held assumptions that lower quality products (generally characterising Southern end-markets) are necessarily governed by market-based coordination mechanisms. We therefore challenge links established in the GVC literature between product standards and private governance.
Highlights
Global value chain (GVC) and related global production network (GPN) research has overwhelmingly focused on suppliers in the global South serving end-markets in the global North, overlooking until recently Southern end-markets
Controlling for product type, function, quality and firm size in regression (2a), the COMESA end-market is associated with interactions that are more stable compared with Europe-led value chains; this is significant at the 1% level
Our analysis of Kenya’s participation in leather value chains shows that private governance varies across different end-markets, and that this variation depends on aspects of product specifications and trust (Figure 2)
Summary
Global value chain (GVC) and related global production network (GPN) research has overwhelmingly focused on suppliers in the global South serving end-markets in the global North, overlooking until recently Southern end-markets. Scholars have argued that more stringent social and environmental standards in Northern compared with Southern end-markets are likely to result in the outsourcing of higher value-added activities (Kaplinsky et al, 2011; Staritz et al, 2011). These considerations are consistent with claims that Southern suppliers exporting intermediate and/or finished goods to Northern end-markets experience more direct and stable relationships with buyers, while.
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