Relational upgrading in global value networks

Abstract

This article takes a geographical interest in the upgrading of countries by adopting a micro-perspective of firms and inter-firm networks. We propose the concept of relational upgrading as complementary to the traditional upgrading of activities such as products, processes or functions. Based on a core–periphery model, we argue that countries may reap additional benefits when moving from peripheral to more central market positions. Drawing on methods of generalized blockmodeling, we demonstrate how formerly peripheral countries in the trade of stock photography have successfully upgraded their market positions over a period of 12 years through increasing integration of their firms in the global value network. The analysis contributes to a relational and comprehensive understanding of upgrading, which suggests combining the upgrading of both, activities and relational positions in global networks to reap additional benefits.