Global Production Networks Research Articles

Equitable Global Value Chain and Production Network as a Driver for Enhanced Sustainability in Developing Economies

Recent studies on the global value chain (GVC) have highlighted the need to better integrate the value chains of developing countries of the global South with that of the global North regions, which are more highly developed. This is aimed at enhancing the economic and social sustainable upgrading of the value chains of the global South regions. The paper thus seeks to answer a critical question as to whether the existing GVC set-up pertaining to global North and South countries is equitable and whether it would yield the needed socio-economic and wider sustainable benefits, particularly to global South countries. a conceptual Global Value Chain (GVC) model is developed based on the economy-wide and system-based Multi-Regional Input–Output methodology to achieve this goal. Subsequently, this was empirically tested to measure embodied flows in capital and labour for sustainable development between global North and South regions. These are achieved using the GVC networks of the UK (from the global North) and some countries in sub-Saharan Africa (from the global South) to exemplify these developments. With implications for equitable, sustainable development, our study shows significant imbalances exist in the flows of value added activities from the global South to the global North, particularly in the primary industries, which produce low-value products in their raw state. Subsequently, this creates a disproportionate economic disadvantage for South countries. As such, if global South countries are to fully benefit from GVC, the study shows that these imbalances must be addressed, such as through structural changes in the economies of global South countries from their dependencies on the primary industries.

Competitive dynamics of lead firms and their systems suppliers in the automotive industry

Lead firms play a dominant role in the governance structure of conventional global production network (GPN) analyses but this framework is not fully applicable in sectors where (new) regulations, technologies and subsequent market changes have a disruptive effect on its governance structure. This paper proposes an analytical framework to examine how disruptive effects of industrial megatrends in forms of new regulations and technologies and the subsequent market changes could alter the competitive dynamics between lead firms and their tier-I suppliers. Although lead firms are becoming more specialized and highly efficient in specific product segments, they may not always have inter-firm control over their tier-I suppliers. GPN boundaries become more permeable when there is an external shock, such as new regulations or massive shifts in consumer demand, or the entrance of an entirely new lead firm, possibly due to a technological breakthrough or innovative use of existing technologies in a product. This external shock could have disruptive effects on the GPN, from the exit of current lead firms to the entrance of new tier-I suppliers or lead firms. Consequently, a reconstituted GPN with a newly established boundary is then produced. Applying the analytical framework to the automotive industry, it is argued that selected (and new) systems suppliers with expertise in micro-electronics are not only in a prime position to capture the value generated by the increasingly stringent regulatory environment on safety and environmental standards, but also more resilient than the incumbent automakers to three emerging megatrends: electrification, digitalization and autonomous driving. JEL: F23, L14, L20, L62

Sticky substance with sticky power: Oil in global production and financial networks

To analyse oil, the world’s most traded commodity, we combine Global Production Network (GPN) and Global Financial Network (GFN) approaches into the Global Production and Financial Network (GPFN). The combination offers a dynamic framework, as key actors and geographies in the GPFN change over time. It brings together the production and financial strands of research on oil and overcomes the physical reality v. financial fiction dichotomy in literature. Using a wide range of data on oil networks, prices, historical accounts, as well as industry, media and policy reports, we apply the GPFN to explain the evolution of oil networks, since their inception, as well as the mid- and short-term price anomalies since 2010. Our history of oil GPFN demonstrates the stability of its analytical categories and the stickiness of power wielded by some actors and geographies, while others come and go. Our account of price anomalies shows the inseparability of physical and financial factors in explaining them. As whole the GFPN is an opportunity to understand the evolving broad structures, distribution of power and price formation in markets, and as such represents a way forward for studying other products and sectors.

Rural Economic Development in India by NGOs

Many Factors are Working behind Rural Development. In all factors are most important is NGO. The term NGO for the purpose of this Document Includes “ not for profit organization registered as a trust or a Society ’’. A non-governmental organization (NGO) is a legally registered organization created by natural or legal persons that operates indipendently from any form of goverment. Rural development generally refers to the process of improving the quality of life and economic wellbeing of people living in relatively isolated and sparsely populated areas of a Nation. Rural development has traditionally centered on the explanation of land-intensive natural resources such as agriculture and forestry. However, at present, changes in global production networks and increased urbanization have changed the character of rural areas. The team Originated from the United Nations and is normally used to refer to organizations that are not a part of the goverment and are not conventional for profit making business.

Lithium, Brexit and Global Britain: Onshoring battery production networks in the UK

As demand for electrical energy storage scales, production networks for lithium-ion battery manufacturing are being re-worked organisationally and geographically. The UK - like the US and EU - is seeking to onshore lithium-ion battery production and build a national battery supply chain. Governmental, industrial and research actors are engaged in securing battery mineral materials and developing battery manufacturing capacity, in the context of the country's exit from the EU and a perceived ‘global battery race’ in which geopolitical goals shape links with new and old partners. We identify the primary global networks of lithium mining and refining, battery chemical production, technology development and finance in which the UK's battery manufacturing capacity are increasingly embedded. We foreground the role of the UK state, and how it has sought to assemble discrete capacities in automobile manufacturing, battery R&D, materials chemistry, minerals exploration, mining and green finance into a national battery sector. We mobilise a Global Production Network (GPN) perspective to highlight the cross-border geographical and organisational structures through which onshoring is taking place. We extend GPN research on the role of the state by showing how the UK's growing lithium networks intersect with a plural and differentiated state accumulation project of green industrial transformation. We outline the selective nature of this state accumulation project, highlight instances of coupling creation as the state seeks to strategically couple regional assets with firms in GPNs, and point to a convergence of industrial and innovation policy characteristic of the entrepreneurial state.

Research on the Influencing Factors, Paths and Effects of Chinese Enterprises' Internationalization Strategy

With the contraction of the global economy and the multiple impacts of the epidemic on the world economy, Chinese enterprises are facing a changing international environment and adapting to a different kind of globalization. China insists on the strategy of both "Bringing in" and "Going abroad", and seeks the road of Internationalization through high-level two-way investment and efficient use of global resources and market space. On the topic of Internationalization of Chinese enterprises, many scholars have conducted many fruitful researches and accumulated many research results. This paper searches and collates relevant literature at national and abroad, and constructs a theoretical model of Chinese enterprises' internationalization , that includes three dimensions: influencing factors, entry modes and influencing effects. By reading the relevant literature in these three areas, we find some results, firstly the process of internationalization of firms is influenced by both internal and external factors; internal factors include the diversity of the executive team and the need for firms to innovate, and external factors include government subsidies, the active promotion of global production networks, the passive promotion of industry-specific needs and the need to expand markets. The second internationalization path includes the export access model, the contract access model, and the investment access model. Thirdly the impact effects of firm internationalization include the level of business growth, the level of research and development innovation and the level of dynamic capacity building.

Understanding Sustainable Value Capture for Ghana’s Cocoa Farmers on the Cocoa-Chocolate Value Chain

The sustainability of cocoa farmers' livelihoods is a critical concern within the academic discourse surrounding the Cocoa-chocolate value chain, aligning with SDG goal 1 of eradicating poverty. Addressing the challenges cocoa farmers face and developing sustainable solutions is paramount, as their low-income status may lead to a shift to alternative cash crops, surrendering lands for illegal mining activities (affecting the environment negatively), and a decline in the cocoa bean supply. Existing literature has explored the limited value capture of cocoa farmers. However, it needs to fully elucidate the complex interplay between local and international interests that undermine efforts to improve farmers' livelihoods. This study uses the Sustainable Livelihood Framework and the Global Production Network to assess these dynamics. The analysis uncovers significant obstacles smallholder farmers face in achieving sustainable incomes, including power imbalances and embeddedness within firm networks. Some policy recommendations, including the de-commodification of Cocoa beans, are proposed.

DUE DILIGENCE AND DECENT WORK. SPECIAL REFERENCE TO LABOUR LEGISLATION IN VALUE CHAINS

In recent decades, the agricultural world has changed, in this new context, international food companies are organized around a global production network. One of the main factors for the introduction of a more decentralized and flexible food and agricultural system was the wage gap between actors from the Global North and the Global South. This study analyzes the effectiveness of the action of control mechanisms in relation to the protection of workers' rights in multinational companies in Spain with special reference to the value chain of the agricultural sector. In particular, the working conditions of workers in food companies will be analyzed, analyzing the inequalities between the different groups of workers, paying special attention to immigrants and women, thus analyzing possible differences, contractual irregularities and salary gaps. Therefore, the article invites us to reflect on the need to implement new control mechanisms and regulatory instruments that intervene to correct the distortions in the agricultural labor market and the imbalances in the working conditions of these groups with the aim of contributing to a transformation of agricultural work through social strategies.

Do Women Benefit from Global Production Networks? Evidence from the Indonesian Footwear Industry

Despite the remarkable improvements in key economic and social standards, the Indonesian footwear industry still struggles to ensure decent work, particularly for women workers. In this paper, female workers are divided into production and non-production workers. Women production workers are used as a proxy for occupational segregation based on sex, called non-skilled workers, while women non-production workers are used as a proxy for women’s share of work in managerial and administrative work, called skilled workers. This paper examines the close links between decent work (DW) and global production networks (GPNs) in the Indonesian footwear industry. More specifically, this article scrutinizes fair employment treatment for local female employees within the DW framework in the country’s footwear industry with the expansion of GPNs based on Indonesian footwear firm-level panel data from 2001 to 2015. Vertical specialization is a proxy for GPNs and is the main independent variable in this paper. The results show that vertical specialization is in line with the fair treatment indicators and has a significant level for female production workers. In addition, the other independent variable, namely the wages of production workers, has a significant level, and the results are inversely proportional to the fair treatment indicator, while the wages of non-production workers show results that are inversely proportional to female production workers but positive for female non-production workers. This shows that an increase in the wages of production workers is less profitable for female production workers than for female non-production workers. Thus, the results show that the expansion of GPNs in the Indonesian footwear sector has essentially led to improved fair employment treatment, especially for women workers.

Complementary approach to the analysis of countries’ participation in global production networks

The purpose of the article is to explore a complementary approach to the analysis of countries’ participation in global production networks. We have analyzed the methodological aspect from the standpoint of the Micro and Macro theory of international production networks and value chains. In the context of globalization, production networks are actively formed within both individual industries and at the intersectoral level, and they successfully operate not only within limited territories but also at the interstate, interregional and global levels. Therefore, the study of methods for analyzing the participation of countries in global production networks is relevant. The article has used statistical analysis methods. Analytical methods have been used to determine the countries’ leading types of economic activity (fields of specialization, qualitative indicators that characterize each of the industries of the countries). The study of this issue was carried out on the example of the EU countries. One of the methods of analyzing the assessment of bilateral relations of the partner countries’ national economies is complementarity. The article examines the complementarity index as an indicator that determines the trade structure of partner countries. We received a model of the Global map of the International Production Network (nodes of trade) by specific industries, such as Manufacturing, Chemicals and non-metallic mineral products, Rubber and plastics products, computers, electronic and electrical equipment, and transport equipment. To obtain accurate results, we selected specific countries: Germany, the USA, Japan and China, and examined their statistics in two dimensions: gross exports and gross imports, in specifically selected industries.

Sustainability in the global value chain-a scientometric analysis.

For its promise in enhancing sustainability, the global value chain (GVC) has grown in relevance and sparked many studies. Due to different value activities in multiple countries and industry clusters, the competition and cooperation among value chains have attracted the considerable attention of business leaders and academicians worldwide. GVC-related sustainability research is a niche area despite its widespread presence in the literature. To bridge the gap, we use scientometric analysis in this paper, examining the corpus of 753 articles published in Web of Science journals from 2001 till 2021. This review illuminates the research performance constituents (e.g., most prolific authors, nations, institutions, and journals), the themes and issues that underpin the fields' intellectual structure, and transforming discoveries. GVC depends on nine basic clusters for sustainability research (i.e., global value chain participation, gendered global production network, repositioning organisational dynamics, labour stands, learning opportunities, Internet era). Future studies can be conducted to generate new knowledge across ten thematic (based on keywords) clusters (i.e., market liberalisation, trade pollution nexus, value chain dynamics, global value chain reconfiguration, non-governmental organisation, multipolar governance). A model that encompasses current knowledge of the global value chain for sustainability is developed, and avenues for future research are provided.

Local Understandings of Decent Work and the Legitimacy of Global Labour Standards: Insights from Garment Suppliers in Egypt and Jordan

This paper contributes to the debates on the effectiveness and legitimacy of global labour standards. Theoretically, the paper integrates literature on labour standards in global production networks with cognitive framing and sensemaking literature to capture decent work understandings of suppliers and to theoretically underpin their relevance for the debates on the legitimacy and effectiveness of global labour standards. Empirically, the study explores cognitive decent work frames of garment suppliers and discusses them in reference to global decent work frames. A thematic analysis of semi-structured interviews with thirty owners and managers in Egypt and Jordan served to identify suppliers’ decent work frames. Owners and managers dominantly framed decent work as a (paternalistic) family responsibility and as a business responsibility. Further notions that recurred across interviews were the framing of decent work as a human responsibility, religious (Islamic) responsibility, philanthropic responsibility, and regulatory responsibility. The findings show that supplier frames partly go beyond, partly undermine, and partly accord with global conceptualisations of decent work. They imply the need to strengthen and better communicate the human rights orientation of global labour standards and to give local social partners the autonomy to supplement and specify standards according to their context-specific needs. Global regulations otherwise risk crowding out informal, locally specific decent work practices that benefit workers in GPNs.

The architecture of global knowledge production – do low-income countries get more involved?

Abstract In this paper, we analyze the extent to which low-income countries integrate into the global knowledge production network. We develop an (undirected) research collaboration model based on which we identify the drivers of global research collaboration using publication data of the field Business and Economics from the Web of Science and macroeconomic data from the United Nations Educational, Scientific and Cultural Organization Institute for Statistics. Network and dynamic panel regression techniques are employed. Our results show that (i) reciprocal preferential attachment and the homophily between countries reinforce scientific collaboration, (ii) there is no evidence that low-income countries are becoming better integrated into the global knowledge production over the years, despite their active participation in international reserach collaboration, while (iii) high-income countries show a basic willingness to cooperate with them, which, in turn, promotes the integration of low-income countries, although this willingness seems to decline; and (iv) as to low-income countries, they have little choice but to invest more in education and R&D in order to advance in the global knowledge production network.

IMPLICATIONS OF INDONESIAN TEA INDUSTRY INVOLVEMENT IN GLOBAL PRODUCTION NETWORK: DOWNGRADING OR UPGRADING?

Since 21st century, the production system of capitalism has experienced rapid development with the globalization of production. The pattern of production is segmented, where a product is not only produced in one country or what is called as global production network (GPN). As a developing country, Indonesia is also involved in the GPN and create global value chain (GVC). One of the industries favored by Indonesia in the GPN is the agricultural industry. Many studies have examined the extent of Indonesia’s involvement and how the impact of Indonesia’s involvement in the GPN will be. However, not many have studied the specifics of commodities. This study examines how tea industry involvement in GPN has a social and economic impact using the framework developed by Handerson on the influence of value, power, and embeddedness on the social and economic improvement of GPN activities. Taking tea industry as a case, the results show that the industry’s involvement in the GPN can have a positive impact on development in Indonesia.

Precarious work: A global perspective

AbstractPrecarious work is universal, though its forms and consequences vary across countries due to institutional, cultural, and historical differences. This article reviews recent research on precarious work from a global perspective, emphasizing the comparative and interdisciplinary research needed for a comprehensive understanding of the structural transformations in contemporary capitalism that promote precarious work. The article has three foci. First, research that details the diverse forms of precarious work, which have become increasingly heterogeneous as national labor markets have been interwoven with global production networks. Second, research on precarious work that emphasizes its disparate impacts for women, youth, the elderly, racial and ethnic minority groups, and migrants, revealing an articulation of precarity and social cleavages. Third, research on the politics associated with precarious work and how some precarious workers have successfully organized and mobilized their interests, such as by unionizing and becoming involved in electoral politics. Still, questions remain regarding precarious work: how precarious workers differ from regular workers in representing their interests and demands and whether precarious workers are a new, independent social class or remain part of a changing working class. Finally, topics for future research on the global dimensions of precarious work are discussed.

Linking production geography and financial performance

PurposeWhen is it more profitable for multinational manufacturers to manufacture in high-cost environments and when in low-cost environments? While the literature offers many cues to answer this question, too little empirical research directly addresses this. In this study, we quantitatively and empirically investigate the financial effect of companies' production footprint in low-cost and high-cost environments for different types of production networks.Design/methodology/approachUsing the data of 770 multinational manufacturing companies, we analyze the relationship between production footprints and profitability during four calendar semesters in 2018 and 2019 (N = 2,940), investigating the moderating role of companies' production network type.FindingsWe find that companies with networks distinguished by both high levels of product complexity and process sophistication profit the most from producing to a greater extent in high-cost countries. For these companies, shifting production to low-cost countries would be associated with negative performance implications.Practical implicationsOur findings suggest that the production geography of companies should be attuned to their network type, as defined by the companies' process sophistication and product complexity. Manufacturing in low-cost countries is not always the best choice, as doing so can adversely affect profits if the products are highly innovative and the production processes are complex.Originality/valueWe contribute to the scarce empirical literature on managing global production networks and provide a data-driven analysis that contributes to answering some of the enduring questions in this critical area.

Rethinking labour risk in global production networks: Resilience strategies of cruise ship workers in the wake of the COVID-19 pandemic

The collapse of the global industry due to the COVID-19 pandemic has demonstrated how precarious the livelihoods of workers embedded in globalised industries are. In the global production network literature, moments of crisis have been addressed in the debate on ‘GPN risk’. While this debate has contributed to our understanding of firms’ risk mitigation strategies, much less attention has been paid to workers’ resilience strategies in the face of risk.To fill this gap, this paper rethinks the concept of ‘labour risk’ by including the perspective of the workers. Drawing on concepts from labour geography, the article sheds light on the resilience strategies of cruise ship workers from Indonesia during the COVID-19 crisis. We interviewed twenty-two cruise ship workers, two non-governmental organisations, and two political authorities to analyse how workers used different resilience strategies (coping, adaptive and transformative) to respond to the risk outsourcing practices of cruise ship companies.Our study shows that workers cope with the crisis by relying on family relations, virtual community networks, and the local labour market. In a few cases, workers followed adaptive strategies of opening their own businesses and leaving the cruise industry. These results emphasise that workers’ resilience strategies play a central role in reproducing exploitative capital accumulation regimes underpinning global production networks.

Theorizing globalized production and digitalization: Towards a re-centering of value

Digital and data-driven technologies are having substantial impacts on global production, with growing analysis within established frameworks such as Global Value Chains (GVC) and Global Production Networks (GPN). Given the claims, however, that digitalization is leading to transformations in the patterns of production and labor, further theoretical work is needed to consider how these frameworks fit with evolving dynamics. Beginning with critiques that mainstream GVC/GPN have poorly theorized the concept of value, the paper argues that a re-centering of value is crucial for improved understanding of digitalization. To do this, broader debates in the literature on the digital economy—on rent and surplus value—are reviewed. These debates provide an expanded perspective of value including a broader understanding of forms of techno-economic rent and the growing debates on heterogeneous forms of labor, shaping production. A stronger orientation towards value within mainstream GVC/GPN studies can absorb some of these ideas, but considering the evolving forms, conventional notions of governance and upgrading may be less viable.

Contextualize Social Responsibility or Credible Responsibility in Global Production Network?

Contextualize Social Responsibility or Credible Responsibility in Global Production Network?

Coupling in Sport

China’s rise in recent years to become an economic superpower has been accompanied by active policies to promote sport and culture. Once chosen by the Olympic Committee in 2015 to host the 2022 Winter Olympics, China faced a problem since its hockey team was not strong and could potentially be humiliated in the climax events of the Games. The Chinese Ice Hockey Association (CIHA) decided on a strategic coupling with Canadian hockey expertise to create credible men’s and women’s hockey teams, including hiring Canadian coaches, taking teams to Canada for extended professional training, playing exhibition games against Canadian teams, inviting Canadian hockey teams and players to China, and recruiting Canadian hockey players with Chinese heritage to play professionally in China on the HC Kunlun Red Star team (men) and the KRS Vanke Rays (women). We label this relationship a global player production network. However, the strict Covid lockdown in China and the froideur that developed in Canada-China geopolitical relations after the detention in Vancouver of Meng Wanzhou and the arrest in China of Michael Spavor and Michael Kovrig, was followed by a decoupling of the Canada-China hockey relationship. But by granting national status to Canadian-born “heritage” players, and by selecting at the eleventh hour the Kunlun Red Star and Vanke Ray teams as their Olympic teams, China effectively re-coupled with Canada and was thereby able to field two credible hockey teams.