Abstract
The geographical spread of the global value chains (GVC) not only makes them complex structures but also raises the challenges of governance for them. Gereffi and Lee (2014) argued that such governance issues may arise from either the vertical (within the structure of the GVC) or the horizontal (from outside) governance of a GVC; and at times, bring the sustainability of GVCs at stake. This study explores the phenomenon in the domain of the horizontal governance, outlining the role of the local institutions and the effects they cast upon the sustainability of the GVCs. This study incorporates the findings derived from transcendental phenomenological analysis (TPA) of the in-depth interviews of twenty-three export managers, working in the apparel firms producing for the GVCs on a long-term basis. The study delivers an explanation of the phenomenon and highlights the role played by the government institutions in it. The essence of this study elaborates the mechanisms of cooperation and coordination between the government institutions and the industry, and the difference in the expected and actual performance of the institutions. It highlights that the government institutions in Pakistan, having rigid culture, are currently not fulfilling the requirements of the apparel production units linked with GVCs; and the behavior of government employees adds to it. The implications emerging from this study, directions for future research and limitations have also been discussed. Besides, the application of NVIVO software to perform the qualitative data analysis (QDA) while performing the TPA adds to the methodological innovation of this study.
Highlights
The pressure of competitiveness has pushed the production in fragments beyond national boundaries resulting in the emergence of the global value chains
This study explores the phenomenon in the domain of the horizontal governance, outlining the role of the local institutions and the effects they cast upon the sustainability of the global value chains (GVC)
This study incorporates the findings derived from transcendental phenomenological analysis (TPA) of the in-depth interviews of twenty-three export managers, working in the apparel firms producing for the GVCs on a long-term basis
Summary
The pressure of competitiveness has pushed the production in fragments beyond national boundaries resulting in the emergence of the global value chains. This study focuses on the sustainability of the global value chains, especially about the local institutions, as they are prone to play an influential role in this regard (Lee, Gereffi, & Beauvais, 2012; Nadvi & Halder, 2005; Rodrik, 2018). The primary research questions outline by the study are: What role government institutions play in the economic sustainability of global value chains? This study uses the agency theory to understand the type and nature of the relationship, interactions, and understanding between the stakeholders of the phenomena, i.e. the government institutions and the industry. The interpretive agency theory is a natural fit for this study as it aims at exploring the conflict among the industry (the apparel production units engaged with global value chains) and the government institutions engaged in facilitating the local firms for the global trade. The government institutions have been considered as the agents as they are dependent upon the revenue collected from the industry in terms of taxes and levies
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