Understanding regional value chain evolution in peripheral areas through governance interactions – An institutional layering approach

Abstract

Due to ‘dark sides’ of global value chain integration, a growing body of literature engages with regional value chains (RVC) as alternative strategy for inclusive regional development. To date, we know little about the conditions and actors under which RVCs evolve. Research dominantly highlights the role of regional lead firms, such as supermarket chains in food RVC, and state interventions. However, the role of other stakeholders such as public organisations and civil society at the local remains unclear. Therefore, the embeddedness of RVCs in multiple institutional layers and their exposure to institutional change needs consideration to understand how they evolve. The analysis of an emerging horticulture RVC in Namibia allows disentangling the interactions of state-driven market protection, firm-driven standardisation, and civil-society-driven collective action by analysing the processes of institutional layering underlying value chain governance. This study asks (1) how public, private and civil society governance forms hamper or foster the expansion of RVCs, and (2) how the layering of various institutions can create synergies rather than frictions. The case study helps to develop a grounded understanding of multi-layered governance, which is a crucial step to understand how RVCs can contribute to inclusive economic development in peripheral, rural areas.