Concept Of Global Value Chains Research Articles

Global value chains in EU law

Abstract There is a burgeoning legal literature about the legal underpinnings of global value chains (GVCs). This article contributes to this literature through the lens of European Union (EU) law and proposes a different conceptual way to read GVCs legally. To that end, the contribution proposes understanding the evolving EU law on GVCs as a process of institutionalization leading to at least three legal forms. In EU company law, GVCs manifest actor-centrically as corporate obligations to govern the value chain. This mostly happens in the policies related to sustainability, but also features in some digitalization policies. In EU consumer law, the value chain appears as a collective network of actors that also bears collective responsibility towards the consumer for the production process. Moreover, in EU market practices and trade law, the value chain is approached in a de-personified manner by, on the one hand, targeting products relating to the territory (import/internal market access) and, on the other hand, trading practices in relations characterised by power asymmetry. These findings suggests that, rather than identifying a uniform legal concept of GVCs in EU law, a fragmented picture emerges in which different sub-areas of EU law develop different, partly even opposing, legal understandings of GVCs.

Concept of Global Value Chains in Quantitative Measurements of Russian Foreign Economic Relations

Concept of Global Value Chains in Quantitative Measurements of Russian Foreign Economic Relations

Productivity and Global Value Chains: A Tale from the Indonesian Automobile Sector

Low productivity and quality of employment have always been a big problem in Indonesia, caused by the lack and mismatch of skills in the workforce. Labor productivity (LP) describes the company’s ability to produce something. This can be determined by added value or output. Several factors influence LP, such as education, age, and training. The concept of global value chains (GVCs) has become an integral part of economic activity, and trade within global production networks has grown more rapidly than conventional trade in final goods. GVCs have both positive and negative impacts on employment opportunities. The automotive industry is categorised as one of the ten primary priority industries in the Indonesian manufacturing sector. This research analyses the impact of LP on GVC integration in the Indonesian automotive industry. The data used in this research comes from the World Input–Output Database (WIOD) and the Central Statistics Agency (BPS) from 1995 to 2014. The variables used include the number of workers, added value, real wages, and GVC, which were calculated by the author using the Inter-Country Input–Output (ICIO) approach. Using ICIO analysis, the following matrix should be constructed to determine involvement in GVCs. This research shows that LP in the Indonesian automotive industry has a positive trend, and the GVC position in the Indonesian automotive industry has a positive trend line. The domestic value chain increased from 4% to 33%. This improves the ability to produce higher value-added and intermediate export goods. LP increases the domestic value chain in the Indonesian automotive industry, leading to global value chain integration. Thus, LP goes hand in hand with integrating GVCs.

Transformation of Global Value Chains in the Context of Modern Macroeconomic Shocks

Purpose: The aim of this study is to examine the concept of global value chains (GVCs) in terms of the distribution of benefits among participating countries by deepening the international division of labor and including geographically distant and differently developed countries. Theoretical framework: The article emphasize that the involvement of countries in GVCs, along with benefits, has several risks associated with both endogenous and exogenous factors. Design/methodology/approach: The authors analyzed GVC studies and used such research methods as a case study and factor, comparative, and structural analysis. Russian and international statistical data were used as the study materials. Findings: The results of the analysis indicate that exogenous factors related to the COVID-19 pandemic and geopolitical tensions have led to the breakdown of GVCs and increased their instability. To address these issues, the authors suggest increasing the domestic value added in industries that rely heavily on foreign resources, reforming GVCs by localizing partnerships through deglobalization processes, and seeking out new trading partners. Research, Practical & Social implications: The study authors propose to make changes to the current structure of GVCs. This can help minimize negative consequences for the economy through the introduction of practices aimed at increasing the number of suppliers, expanding sales markets, and optimizing production processes. Originality/value: The value of the study lies in its identification of both the advantages and challenges of GVC participation for countries. It also offers practical solutions to enhance the resilience of GVCs, making the study results relevant for policymakers, businesses, and industries involved in GVCs.

Systematization of theoretical approaches to the concept of global value chains

The article examines the peculiarities of the formation and development of the concept of global value chains. The work systematizes existing research on various aspects of the analysis of this phenomenon. On the basis of systematization, the following five main directions were identified, which were considered in the study: 1. by the structure of costs and output in global value chains, which reflects the processes of transformation of raw materials into the final product; 2. by geographical aspect, i.e. location of production processes and functions of the company and optimization of interaction between them; 3. on the structure of management and distribution of influence in global value chains, which considers the level of influence and distribution of roles between the main participants of these chains; 4. by the institutional aspect, which involves the study of the influence of institutional features of countries and/or industries on various links of global value chains; 5. for the development in global value chains of value from studying the process of movement of chain participants to higher levels of generating added value. Based on the systematization and study of scientific publications, the two most promising areas of further research are distinguished: the influence of institutional distance between countries – participants of global value chains on the configuration parameters of these chains and the role of various types of contractual relations between companies in the configuration and improvement of operations within global value chains. Special attention should be paid to the least studied aspect of the analysis of global value chains – the institutional one. In the context of developing countries, this problem is extremely relevant, since, on the one hand, it combines the potential for improving existing concepts (originally created for companies from developed countries) and the development of new directions, and on the other hand, it has practical significance in the conditions growing participation of companies from these countries in the world economy. The study of the structure and dynamics of changes in the sectors of the world economy by combining various aspects of the analysis of global value chains helps to determine where, how and by whom value is created and distributed: economic and social, tangible and intangible, as well as other types of value.

ФЕНОМЕН ТРАНСРЕГИОНАЛЬНЫХ МЕГАПРОЕКТОВ И ИХ ВЛИЯНИЕ НА ПРОЦЕССЫ ЭКОНОМИЧЕСКОЙ ИНТЕГРАЦИИ

The article is about the conceptualization of the trans-regional mega-project phenomenon by the examples of China’s initiative “One Belt – One Road”, the EU “Global Gateway” and Japan “Free and Open Indo-Pacific” through the following theoretical approaches: neo-functional integration theory, spatial approach, the concept of global value chains. The neo-functional theory of integration and the phenomenon of “Haas spill-over” are used for assessing the integration potential of trans-regional megaprojects. The main features of the trans-regional megaprojects are distinguished through the comparison of trans-regional partnerships and megaprojects. The influence of trans-regional megaprojects on global value chains is evaluated by the examples of industrial and investment projects implemented within the framework of “One Belt, One Road”, “Global Gateway” and Japan’s Strategy “Free and Open Indo-Pacific Region”.

Global Value Chain Analysis on PT Batik Keris Surakarta

Batik is an Indonesian cultural heritage that has been recognized by The United Nations Educational, Scientific and Cultural Organization (UNESCO). In addition to cultural heritage, many Indonesian people live through Batik crafts. Batik Keris is one of the Lead Firms in the Batik industries in Surakarta, even in Indonesia, where it plays an important role in the Batik industry and also in preserving Batik itself. This study examines the global value chain of PT. Batik Keris and their role as Lead Firm in the Batik industry and their relationship with the Surakarta City Government program. This study uses a qualitative descriptive method by applying the Global Value Chain Concept introduced by Gerry Gereffi (2016). Meanwhile, the data was obtained through interviews with related sources and literature studies. The results show that Batik Keris has implemented an upgrade strategy ranging from design, use of technology, to carry out various activities such as fashion shows and Batik Carnival.
 Keywords: Batik Industry, Batik Keris, Global Value Chain, Local Economic Development

Current freezing and thawing scenarios employed by North Atlantic fisheries: their potential role in Newfoundland and Labrador's northern cod (Gadus morhua) fishery.

Seafood is very perishable and can quickly spoil due to three mechanisms: autolysis, microbial degradation, and oxidation. Primary commercial sectors within the North Atlantic fisheries include demersal, pelagic, and shellfish fisheries. The preservation techniques employed across each sector can be relatively consistent; however, some key differences exist across species and regions to maintain product freshness. Freezing has long been employed as a preservation technique to maintain product quality for extended periods. Freezing allows seafood to be held until demand improves and shipped long distances using lower-cost ground transportation while maintaining organoleptic properties and product quality. Thawing is the opposite of freezing and can be applied before additional processing or the final sale point. However, all preservation techniques have limitations, and a properly frozen and thawed fish will still suffer from drip loss. This review summarizes the general introduction of spoilage and seafood spoilage mechanisms and the latest preservation techniques in the seafood industry, focusing on freezing and thawing processes and technologies. This review also considers the concept of global value chains (GVC) and the points to freeze and thaw seafood along the GVC to improve its quality with the intention of helping Newfoundland and Labrador’s emerging Northern cod (Gadus morhua) fisheries enhance product quality, meet market demands and increase stakeholder value.

Russian Economy as a Pyramid of Wealth Enclaves: Political Economy Approach

The article highlights the resource-industrial and institutional conditions causing the fragmentation of the economic space in Russia. In these conditions, the integration of the economy and society is ensured through the integrated political-administrative market of the centralized type. As a result, the functioning and development of the Russian economy are described as a complicated interweaving of the horizontal added value chains and the vertical chains of value redistribution. This created the pyramid of wealth enclaves in the Russian economy. The interaction between the actors controlling these enclaves occurs mainly on the political-administrative market, connected with the vertical redistribution of added value. The theoretical basis of the study is J. Stiglitz’s model of dual enclave economy and the modified tools of the concept of global value chains (GVC). The study operates such qualitative research methods as conceptualization and comprehensive analysis. The study revealed that in the Russian economy the economic market fragmentation situation is persistently present. The pyramid of wealth enclaves linked with the vertical chains of value redistribution does not create incentives for the integrated development of the national economy

Strategic technology management within global value systems

Abstract Contemporary the concept of global value system extensively elaborated by scientist and applied by practices in the fields of management, economics and politics. The aim of this article is to provide the theoretical background and evolution of the global value system methodological approach from the global strategy management perspective. The technologies are considered as the main source of added value. Therefore the main scholars of technologies strategic management are provided in the article, though in the global value system concept it is implied that the source of added value originates from the allocation of added value activities across borders. Recently scholars analyse various sources for the added value upgrading, though critics of global value chain concept emphasise that besides economic added value, social issues should be considered.

Diplomasi Perdagangan Indonesia dalam Rantai Pertambahan Nilai Global Produk Tekstil ke Pasar Timur Tengah

<p class="06IsiAbstrak"><strong>Indonesia Trade Diplomacy in the Textile Product Global Value Chains to the Middle East Market</strong>. Textile and textile products are important commodities for all developing countries, including Indonesia. Despite of those significance, developing countries have to deal with the challenge of the global context. The crisis in developed countries previousely were major textile export destination add the challege. This paper aims to find out Indonesia’s strategy to maintain its textile industry as its major potential commodity. In doing so, this research focuses on the strategy of trade diplomacy in the context of global value chains. Considering the decline trend of export to the developed countries, this research focus on the market of Middle East as the non-traditional market. This reseach applies descriptive qualitative reseach metodh with the concept of global value chains and trade diplomacy as the research analitical framework. This research finds that, in the context of GVC, Indonesia has the highly competitive barrier to entry suitable to penetrate Middle East market. It has production chains domestically, while marketing chains to the Middle East countries. Furthermore, in trade diplomacy, Indonesia implements the function of representation, negotiation, and advocacy.</p><p class="06IsiAbstrak">Keywords: Textile products export, GVC, trade diplomacy, Middle East market</p>

Introduction: Bringing Institutions Back in the Study of Global Value Chains.

The article introduces and summarizes the key questions and findings of this special issue of Global Policy on the role of domestic and international institutions in the study of Global Value Chains (GVCs). The article starts by briefly introducing the concept of GVCs and the state-of-the-art of the existing literature focusing on the political implications of these landmark changes in the global economy. Then we make a case for grounding this emerging literature more strongly into an "institutionalist" perspective. More specifically, we argue that while a great deal of attention has been paid to intra-chain governance modes - i.e. the different ways in which firms organize their cross-border production arrangements - the role external institutional forces play in structuring chain dynamics remains surprisingly under-researched. These observations invite an analytical perspective that brings institutions back into the study of GVCs. The contributions to the special issue focus on multiple causal pathways linking GVCs and various types of domestic- and international institutions. Altogether, these contributions underscore that the politics engendered by GVCs, as well as how they evolve, can only be fully understood by paying attention to the external institutional context in which they are embedded.

МЕЖДУНАРОДНАЯ ТОРГОВЛЯ В КАТЕГОРИЯХ ДОБАВЛЕННОЙ СТОИМОСТИ: ВОПРОСЫ МЕТОДОЛОГИИ

The article is aimed to investigate and discuss methodological issues and challenges related to the measurement of international trade in value added terms. Basing on the analysis of the concept of Global Value Chains (GVCs) and the substance of related theoretical categories, the author gives his own vision of the place that the Trade in Value Added (TiVA) concept occupies in the modern economic theory. It is pointed out that various approaches to the definition of value added, global chains, global value added chains, global import intensity, and other terms appeared recently. The author focuses on the problem of double-counting of intermediary goods (that leads to overstatement of the importance of trade) and on the estimations of the differences between exports in value added terms (so-called domestic value added embodied in foreign final demand) and gross exports. Such discrepancies reach as much as 25% of gross flows. Special attention is paid to the use of the World Input–Output Database (WIOD) in the analysis of the international trade. Its usefulness is illustrated by applying it to both intermediate goods and final products of Russian manufacturing exports. The author agrees with those economists who believe that conceptual framework of international trade in value added has been enhanced in the latest decade. Following Koopman et al. (2010) it is shown that a country’s exported value added can be broken down into three large components, including domestic value added, returned domestic value added and foreign value added. The author’s conclusion is as follows: Global Value Chains should not be regarded in themselves. They appear only where their total benefits exceed their total costs including transactional and other costs. Acknowledgements. The article was prepared at the Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences and supported by a grant from the Russian Science Foundation (project no. 14-28-00097 “The optimization of Russian external investment ties under deterioration of relations with the EU”).

Local institutions and global value chains

PurposeThe purpose of this paper is to explore how the shrimp aquaculture export industry in Vietnam can achieve further development in the highly competitive global market particularly in the context of complying with food safety standards set by the markets.Design/methodology/approachThis paper applies two conceptual approaches, local institutions and global value chains. The concept of global value chains helps this paper to understand what extent the external pressures are placed on the industry while the concept of local institutions effectively examines its responses to the external pressures. Applying this conceptual framework this paper examines an empirical case analysing secondary data and literature.FindingsMarket requirements on food safety are brought by global buyers through the global value chains governance structure to the local institutional function. It includes local buyer-supplier relationship within the industrial cluster, industrial policy and business institutions, although it is less likely to address the local backwards suppliers to improve the industrial capability of food safety standard compliance.Research limitations/implicationsThis paper has a research limitation due to the prioritised research scope that critically examines potential pathway for further development of Vietnamese shrimp aquaculture export industry. Therefore, it needs further comparative in-depth analysis with more vertically organised industrial structure performed by the countries such as Thailand.Originality/valueThe originality of this paper is to critically examine the conceptual limitation of global value chains approach in the context of food safety standard compliance issue, which is likely to be originated in local backward suppliers by applying a complementary concept, local institutions.

Глобализация индийской экономики: тенденции и перспективы

The aim of this research is the analysis of the globalization model of the Indian economy, its main trends and perspectives. The article highlights the ways of India’s integration in the world economy –its participation in the international capital movement and in the international trade as well as its positions in global value chains. The author examines the most representative definitions of globalization and draws attention that the theoretical basis of the study is the synthesis of the concept of global value chains and A.P. Thirlwall’s definition of globalization. The methodological basis of the study is such methods as induction and deduction, analysis and synthesis. The systematic approach to the overall study of the Indian economy and the Indian external economic policy in particular has become the base of this research. The author underlines that according to the OECD data the Indian participation in global value chains is 42% of the Indian gross exports. At the same time India as a large economy has a less share of exports made of inputs taking part in vertical trade in comparison with other developing countries due to diversified national economy created during the importsubstitution period. The author notes Indian positions in international capital movement. The author stresses that the Indian contemporary investment policy is aimed at attracting foreign capital that doesn’t lead to the formation of external debt. The article highlights the Indian positions in international trade of goods and services. The author examines the composition of Indian exports and imports as well as direction of Indian trade. The author draws attention to increasing the Indian positions in trade in intermediate goods. It proves the active participation of India in global value chains. The article presents statistical data on the Grubel-Lloyd Index which measures India and the world economy intra-industry trade as well as RCA coefficient which measures the comparative advantages of the Indian economy in trade both in goods and services. The article also presents statistical data on the dynamics of the Indian external trade, foreign direct investments’ inflow and exports of the Indian capital.

Project Investment and Development

Project Investment and Development

Jak awansować w światowej lidze gospodarczej? Kraje Europy Środkowo-Wschodniej w globalnych łańcuchach wartości

The main objective of the article is to present the characteristics of the contemporary wave of globalization on the basis of the concept of global value chains (GVCs) and to draw on this basis positive and normative implications for the countries of Central and Eastern Europe. In particular, we have outlined the nature of the challenges currently faced by these countries and ref lected on the desirable directions of public policies. Special attention has been given to technological development that enables gaining high value added. Theoretical considerations have been supplemented and supported by empirical arguments in the form of indices of integration of economies in the GVCs, as well as by the conclusions from the economic literature. (original abstract)

Gender relations in global agri-food value chains – a review

This article reviews the research literature on gender relations in global agri-food value chains. The main focus is on the production side in countries of the Global South, with most examples from sub-Saharan Africa. After a short presentation of the underlying concepts and a review of the existing research literature, an outline is given of the major insights the analysis of gender issues in global value chains has offered. What is striking is the heterogeneity of the findings and proposed actions, as well as the scarcity of conceptual approaches that would integrate gender analyses further into the concept of global value chains.

Temporary resource availability and quality constraints in the global leather value chain – The impact of the festival of sacrifice on the leather industry in Bangladesh

Although Bangladesh's livestock population provides a significant resource of raw material for value addition, the export performance of the leather processing sector is poor. Internally sourced raw hides and skins (RHS) dominate the procurement structure, but are subject to cultural-religious traditions. This study seeks to investigate the extent that the three-day Festival of Sacrifice (Eid-ul-Azha), on which every year Muslims sacrifice millions of animals to Allah and which accounts for more than 40% of the annual RHS production constrains the industry's competitiveness.Based on the global value chain approach, our findings are drawn from qualitative data. We show that Eid-ul-Azha leads to a temporary oversupply of RHS, which results in serious challenges in the organization of the value chain. Our results point to the special role of systemic trust ensured by religious requirements for sacrificial animals and thus RHS, which enables middlemen to enter the supply chain temporarily. Despite their flexible and voluminous small-scale collection, temporary middlemen lack experience and competences to adequately assess quality and price, thus affecting the competitiveness of downstream actors, in particular the tanneries.Our findings complement the concept of global value chains by stressing the impact of culture-specific constraints, temporarily available resources and trust in relations to middlemen on the competitiveness of the export-oriented leather industry.

THE GLOBAL VALUE CHAIN

The global value chain concept has become one of the most influential frameworks used in the study of globalization. The paradigm, however, is deficient in explicating the exploitative nature of global value chain governance. Based on a study of soccer ball production in China and Pakistan, this article analyzes global production from three perspectives: the role of the state in shaping the host countries' mode of production and legal framework, the issue of how surplus value is created and distributed, and the use of child labor or prison labor to remain competitive in the chain. The article shows, in the case of Pakistan, how a country using a lower-labor-costs strategy to retain a place in a global value chain allows its workers to be exploited and pauperizes its people.