Labor-intensive Industries Research Articles

Value capture and value production in the world economy: A Marxian analysis of global value chains, 2000–2014

The paper estimates the production, realisation, and capture of economic value in the world economy from 2000 to 2014. Estimates show how value is produced and transferred across 56 sectors and 43 countries. The methodology builds on the Marxian literature and the productive-unproductive classification. Value production is the labour directly and indirectly required to produce goods and services within global value chains. Value capture is the deviation between value realisation and production. Results show that China is the largest giver of value while the USA is the largest capturer of value in the world economy. Unproductive activities (real estate, finance, and trade) and capital-intensive industries (manufacturing, mining, and oil) are value capturers. Labour-intensive industries (health, education, construction, agriculture, and services) transfer value away. The paper also demonstrates that the theory of unequal exchange is incompatible with the conventional assumption that all activities are productive. Only under the Marxian productive-unproductive classification do the results converge with unequal exchange theory.

Transiting towards green productivity: Evidence from Indian organized manufacturing industries.

Promoting green growth and decarbonizing economies to achieve sustainable economic development has become critically important globally. This study calculated the energy-induced carbon emissions and green total factor productivity (GTFP) for the organized manufacturing sector in India utilizing factory-level Annual Survey of Industry datasets. The GTFP has been calculated utilizing the Global Malmquist-Luenberger index methodology at both the aggregate and industry levels. Additionally, it examines the convergence hypothesis for the major Indian states from 2001-02 to 2021-22 by employing the Phillips and Sul (2007, 2009) methodology to analyze the distribution dynamics of GTFP. It analyzes structural changes in carbon emissions and carbon productivity, while also identifying the most polluting industries at the sector level. The study's findings indicate that labour-intensive industries contribute the least to GVA while producing substantial emissions. There is a complete divergence across the regions in GTFP, indicating two clubs and one non-convergent group. Our findings offer novel insights to policymakers on the dynamics of GTFP and enhancements in productivity, while integrating environmental considerations.

Application of 3D Simulation Techniques and Tecnomatix Software in Balancing the Sewing Lines in the Garment Industry

The Fourth Industrial Revolution, or Industry 4.0, integrates advancements in physics, digital technology, and biology to create new production capabilities and significantly impact economic, political, and social systems. Textile and garment production, a labor-intensive industry, faces particular challenges from Industry 4.0. In this context, the trend toward digitized and automated equipment—utilizing the Internet of Things (IoT), cloud computing, 3D printing, big data analytics, and artificial intelligence (AI)—is gradually replacing human labor in garment factories and throughout supply chains. To keep pace with global trends, Vietnam's textile and garment industry must adopt Industry 4.0 technologies to boost productivity, with sewing line balance being a crucial aspect of this effort. In this article, the authors present research findings on 3D simulation techniques applied to sewing lines for women’s shirts and jackets, using Tecnomatix software. They evaluate and compare the effectiveness of traditional methods for balancing sewing lines and propose improvements based on 3D simulation results. Applying these simulation techniques to real-world production is expected to enhance productivity and labor efficiency in industrial sewing lines, contributing to the development of smart garment factories in Vietnam in the Industry 4.0 era.

Escaping the resource curse: does resource dependence reduction mitigate income inequality?

This paper quantifies the impact of resource dependence reduction on income inequality. Using an exogenous shock triggered by China’s sustainable program for resource-based regions and prefecture-level data during 2004–2020, we perform a difference-in-differences estimation and find that reducing resource dependence has a sizable narrowing effect on urban-rural income gap. On average, the sustainable program reduces the gap (as measured by a ratio indicator) by 4.11%, with the effect being more pronounced in regions with initial low institutional quality. Further evidence suggests that the rise of labor-intensive industries and the increased rural investment, which benefit the poor more, help explain the narrowing effect. This paper sheds light on the sustainable development of resource-dependent regions.

The Evolution and Performance Response of Industrial Land Use Development in China’s Development Zone: The Case of Suzhou Industrial Park

Development zones are crucial spatial carriers driving economic growth and industrial upgrading, playing a key role in China’s development. After years of expansion, these zones face significant challenges in industrial land development and performance enhancement. This paper takes Suzhou Industrial Park (SIP) as a case, which is a model of Sino–Singaporean government cooperation. Using Landsat 4–5 TM data, socioeconomic data, and industrial land use data, spatial analysis and statistical modeling were employed to examine the evolution and phased patterns of industrial land use in SIP from 1994 to 2022. A performance evaluation system encompassing economic benefits, innovation-driven growth, development intensity, green development, and social security was developed to assess land use performance and its responses to spatial transformations. The results reveal that industrial land in SIP experienced a significant change in the intensity of land expansion from 1.031 to 0.352 during 1994–2022, and the peak circle density expanded from 3 km to 15 km. The mean value of the comprehensive performance score during 2017–2022 was 42.18, with the highest economic efficiency (40.54) and a lower innovation capacity (16.98). The development of industrial land in SIP presents the stage characteristics of monocentric polarization, polycentricity, and spatial diffusion toward a generalized development zone, showing significant path dependence, and the difference in the land use performance of different industrial types is obvious. In the future, the optimization and redevelopment of the stock of land should be strengthened to promote the optimization of the spatial layout of technology-intensive industries and the technological upgrading of labor-intensive industries, as well as achieving sustainable economic growth through innovation-driven, green development and enclave economy collaboration. This study provides a reference for the industrial layout and high-quality sustainable development of development zones.

Uncertainty shock and digital transformation: evidence from COVID-19

ABSTRACT This paper examines the impact of uncertainty shocks, exemplified by the COVID-19 pandemic, on enterprise digital transformation using a difference-in-differences (DID) approach with data from Chinese A-share listed companies. Our findings reveal that such shocks accelerate the process of digital transformation, a conclusion that withstands parallel trend tests and multiple robustness checks. Heterogeneity analyses show that knowledge-intensive and service-oriented industries generally exhibit stronger trends in digital transformation, while traditional labour-intensive industries face more challenges. Further mechanism analyses identify technology upgrading effect, cost effect, and peer effect as the primary channels through which uncertainty shocks influence enterprise digital transformation. This study contributes to the existing literature by providing comprehensive empirical evidence on how uncertainty shocks drive digital transformation across various industries, extending research on coping strategies for such shocks and broadening our understanding of the drivers behind enterprise digital transformation.

Enhancing Productivity: The Impact of Standardized Work Methods in the Shrimp Processing Industry

Shrimp production, a major global industry predominantly in Asia, faces efficiency challenges due to labor-intensive methods, labor shortages, and rising costs. This research develops standardized peeling methods to enhance productivity and examines their impact, considering employee age, experience, and shrimp size. Data were collected from employees categorized by age and experience. The study proposed and compared two peeling methods, Method A and Method B, with various sizes of shrimp. Productivity was measured, and factorial ANOVA was used to analyze the main effect of standardized peeling methods and interaction effects between peeling methods and various factors, including employee age, experience, and shrimp size. Results indicate that Method A significantly improves productivity. Employee experience emerged as a crucial factor, while age had a moderate effect. Minor interaction effects between peeling method and raw material size, as well as worker age, were insignificant. No interaction effect was observed between the method and worker experience. Method A consistently outperformed Method B and current practices. The study underscores the importance of standardized work methods and individual characteristics in driving productivity. Findings support the adoption of standardized methods, investment in training, cost management, and technological integration alongside regular review of work procedures, as key strategies for enhancing productivity in labor-intensive industries.

Robot adoption and firm export: Evidence from China

Whether the robot adoption can lead to a new competitive advantage in international trade has become an urgent problem for firms that export from China. Using matching data from the International Federation of Robotics (IFR) Database and the China Industrial Enterprises Database and China Customs Database for 2011 to 2013, this study examines the impact of robot adoption on firm export and its mechanism. We find that the robot adoption significantly promotes firm export, including the value and intensity of firm export, mainly owing to an improvement in firm productivity. This effect remains robust after using instrumental variable to account for endogenous factors and replacing core explanatory variables. Heterogeneity analysis shows that, first, robot adoption plays a greater role in promoting firm export by foreign enterprises and private enterprises than by state-owned enterprises. Second, robot adoption has a stronger effect on labor-intensive industries than on non-labor-intensive industries. Third, with the increase of firm scale, innovation and human capital, the promoting effect of robot adoption on firm export increases. Our research provides empirical evidence on the positive impact of robot adoption on firm export and sheds light on how to maintain the competitiveness of manufacturing firms in China.

Industrial robots and export product quality: evidence from China

ABSTRACT In this study, we first construct a theoretical framework for a heterogeneous product quality model to analyse how robot adoption affects international trade through quality upgrading. Then, we use micro-level data from Chinese Customs Trade Statistics and the Annual Survey of Industrial Firms to examine the heterogeneous effects of industrial robots on export product quality. Both theoretical analysis and empirical research show that industrial robots promote export product quality upgrading through effectively improving firms’ total factor productivity and reducing marginal production costs. Moreover, industrial robots have different effects on firms based on product types, ownership properties, and factor intensity. The results show that the effects of industrial robots on export product quality are stronger for homogeneous products, foreign and private enterprises for homogeneous products, foreign and private enterprises, and labour-intensive industries. These findings align with the literature on the wide-ranging impact of industrial robots, while offering a distinct opportunity to empirically investigate enterprises’ diverse responses to a uniform general-purpose technology. This study also diverges from previous research by examining a previously overlooked dimension: productivity-boosting and marginal cost-reducing effects.

Research on Ecological Restoration Strategies for Abandoned Mines Based on Ecology-Oriented Development

The ecological restoration of abandoned mines poses a significant challenge within China’s broader efforts toward the protection and restoration of the nation’s ecosystems. Based on the ecology-oriented development (EOD) model, a differential game framework for the ecological restoration of abandoned mines was constructed in this study, involving both government and corporate entities as players. Our analysis focused on various factors, including investment levels in ecological restoration quality, the quality of ecological restoration itself, investment levels in environmentally sensitive industry development, the quality of environmentally sensitive industries, environmentally sensitive product pricing strategies, and profit dynamics for both players across four distinct modes. Our findings reveal several key insights. First, extending the government’s concession period incentivizes enterprises to increase investment in both the quality of ecological restoration of abandoned mines and the development of environmentally sensitive industries. Second, the government should prefer the cooperative mode to introduce social capital for the ecology-oriented development of abandoned mines. Third, in noncooperative mode, for technology-intensive industries, the government’s industrial support policy is more mutually beneficial; conversely, for labor-intensive industries, the ecological restoration compensation policy yields higher mutual gains. Lastly, differentiated incentive policies implemented by the government across various modes prompt the input of enterprises in ecological restoration quality and environmentally sensitive industry development. Based on these findings, we offer specific policy recommendations to guide governmental efforts in promoting EOD for the ecological restoration of abandoned mines. Funding: This work was supported by the Sichuan Office of Philosophy and Social Science [Grant SC22C004] and the National Social Science Fund of China [Grant 22XKS015].

The effects of compensation, organizational commitment, and job satisfaction on work productivity: Evidence from readymade garments industry in an emerging economy

Despite noticeable research interest, the labor-intensive Readymade Garments (RMG) industry has rarely been studied from the perspective of workers’ productivity. Additionally, previous studies already generalized that rewards and organizational commitment lead to employee productivity. However, extant research focused on the RMG industry of Bangladesh, which consists of a different socio-cultural, economic, and political environment, as well as profusion dependency on unskilled labor with an abundance supply of it, hardly considered job satisfaction as a factor that may affect the dynamics of compensations or rewards, commitment, and employee productivity. To address this research gap, this study analyzes the spillover effect of compensation, organizational commitment, and job satisfaction on work productivity in Bangladesh’s readymade garments (RMG) industry. Besides, it delves into the analysis of job satisfaction as a mediator among these relationships. We examined the proposed model by analysing cross-sectional survey data from 475 respondents using the partial least squares-structural equation model in Smart PLS 4.0. The findings show that higher compensation and organizational commitment levels lead to higher levels of job satisfaction, leading to greater productivity. This research also discovered that job satisfaction is a mediator between compensation and productivity and commitment and productivity, respectively. Results further show that increased organizational commitment and competitive wages are the two keyways to boost job satisfaction and productivity in the RMG industry. Relying on the findings, this study outlines pathways for organizational policymakers to improve employee productivity in the labor-intensive industry in developing countries.

Network spillover effects and path analysis of shocks - An empirical study in China

The study of interconnections between various sectors of the national economy is crucial for understanding the pattern and pace of macroeconomic growth. This paper analyzes the macroeconomic impact of shocks occurring in specific sectors through both supply and demand perspectives and proposes a combination of bottom-up and top-down structural path analysis approaches to trace the transmission path of network spillover effects, where shocks in this paper refer to microeconomic productivity changes and network spillover is defined as the effect on GDP due to the propagation of shocks to other sectors. The research results found that the total spillover effect of primary and secondary industry sectors in China shows an inverted U-shape, and the total spillover effect of tertiary industry sectors shows an upward trend. A large total spillover effect of a sector does not mean that both upward and downward spillover effects are large; for example, the construction industry has high upward spillover effects and low downward spillover effects. The spillover effect of each production layer decreases as the path lengthens, and the distribution is L-shaped. In addition, by identifying the critical paths of spillover effects, we find that the spillover effects of labor-intensive industries, such as wholesale and retail, are decreasing year by year, and the spillover effects of the paths related to the information technology industry are gradually occupying an important position.

Determinants of location changes in the clothing industry in Poland

Abstract The clothing industry is often perceived, particularly in the European context, as a declining, traditional, labour-intensive industry. Nonetheless, in recent years in Poland, after over three decades of steady shrinkage, though the average scale of operations has continued to decline, the number of firms in the sector has been much more stable. In their analysis of the locations of apparel producers on the national level, the authors point to the changing geography of the sector in terms of its increased or diminishing relative presence in some areas. The links between location tendencies among firms in the clothing industry and other fashion-related institutions and initiatives are noted, as are new firms in the creative sector. The spatial patterns observed point to the ability of the resized sector to leverage emerging market opportunities and upgrade selectively, and to its broader evolution from a traditional towards a creative industry.

TOGAF Utilization for Revolutionizing Enterprise Architecture at Labor Intensive Industry

Labor-intensive industries face challenges in optimizing information systems and technology. Disconnected business processes cause scattered data and poor application integration. A structured approach is required to design an enterprise architecture aligning business and IT strategies. This study explores TOGAF implementation in a labor-intensive business in Jakarta, focusing on creating a more efficient architecture. The research provides design recommendations, including human resource management portal enhancements. Using TOGAF and UML, the study successfully created an enterprise architecture addressing business, application, data, and technology needs, improving departmental integration, overall business performance, and service delivery. It effectively bridges IT and business strategies.

The Impact of Minimum Wage System on Low-Income Groups

The minimum wage system sets a legal floor on the income of workers. It provides economic security for low-wage workers and ensures that their basic needs are met, thereby reducing poverty. For low-income workers, increasing the minimum wage directly enhances their earnings, living standards, and financial stability. As a research focus, the primary area of examination would be the precise effect of minimum wage adjustments on the income levels of those in low-paying jobs: analyze the changes in the real income of low-income workers after the augement of minimum salary and the improvement influence of family economic conditions. Second one is exploring the impact on this system changes employment sector: Examine whether raising the minimum wage causes employers that reduce hiring or layoffs, and the potential impact of such changes on low-skilled labor markets. The last one is analyzing the impacts of minimum wage policies of psychological and low-income groups’ social wellbeing: Using questionnaires to understand changes in the perception of low-income workers about their job satisfaction, quality of life, and social status. The rise in this system significantly rose the income level of low-income workers, helped to alleviate poverty, and raised the basic standard of living of these families. In the short term, that increase may have a certain negative impact on some labor-intensive industries, in the form of a small number of job losses; But over the longer term, the job market stabilizes as companies adapt to increased costs and improve efficiency through technological innovation.

To What Extent Did the Chinese Banking Industry Affect Chinas Economic Growth in Past 50 Years?

Currently, the Chinese economy is encountering a period of stagnation in its development. Sustaining the rapid growth rate of the economy has become a challenge, as there is a lack of adequate momentum for continuous high-speed advancement. The nation is edging closer to the middle-income trap, and the conventional approach of relying on investment, exports, and consumption to propel economic growth is proving to be unattainable. It must be achieved through the transformation of economic structure, and the transformation of the financial industry is the most important part of it. The research question of this article is how commercial banks affect economic growth and how China's banking system has developed. The WTO's entrance into China has been a major catalyst for the banking industry and its system to be built. The literature review section delved deeply into economic growth, examining the concept of it, how it is achieved in China, as well as any factors that may influence it. More importantly, the study reviewed what the banking industry is and the development stages of China's banking industry. The banking industry's development was examined in the concluding part of the literature review, examining pertinent studies on the effect of economic expansion. In the discussion section of the research, we analyzed how the banking industry affects economic growth through its impact on capital allocation, banking services, and currency. Ultimately, we drew corresponding conclusions and proposed countermeasures and suggestions for the future development of the banking industry. Due to the fact that the industrial structure of developing countries is usually dominated by labor-intensive industries, clarifying the interrelationship between China's banking structure, capital allocation efficiency, and economic growth has universal significance and reference value for relevant financial arrangements in developing countries.

Globalisation and Performance of Manufacturing Sector in Punjab and Tamil Nadu: Implications for Employment and Wages

The present study is a comparative analysis of the performance of the organised manufacturing sector of Punjab and Tamil Nadu. The aggregate and the disaggregate picture reveals that globalisation-led growth of the manufacturing sector in Tamil Nadu has transformed its economy to a highly industrialised economy in Indian Union, and Punjab remained far behind in this context. However, the implications of the performance of the manufacturing sector on employment and wage share have shown common characteristics in both states. The increased capital intensity in the globalisation era has widened the gap between labour productivity and wage share in both states. Since 1991, the emoluments (capitalist share) have increased at a higher rate than the real wages. The decomposition analysis of wage share shows that the falling labour–capital ratio and increased contractualisation of the labour market are some of the important reasons behind the low growth of employment and fall in the wage share. Moreover, the disaggregated analysis reveals a secular increase in the use of capital per unit of labour in labour-intensive industries that has further reduced the employment elasticity of gross value added (GVA) in both states. It also highlights that regional heterogeneity plays an important role in the performance of a particular industry with respect to employment and wage share. JEL Codes: F60, J24, L60

ASEAN Four’s middle income trap dilemma: evidence of the middle technology trap

In Southeast Asia, Malaysia, Thailand, Indonesia and the Philippines are defined by the World Bank as countries that failed to overcome the "middle income trap". The four Southeast Asian countries (hereinafter referred to as the "ASEAN Four") entered the ranks of middle-income economies in the late 1970s and early 1980s and achieved rapid economic development throughout the 1980s and 1990s. However, since the early 2000s, the competitive advantages of these countries’ labor-intensive industries have started to decline, while the process of industrial transformation and technological improvement has been stagnated due to the lack of innovation resources. With limited R&D input and insufficient indigenous tech innovation, these countries’ manufacturing industry show a trend of "deindustrialization" and the "middle technology trap" phenomenon emerged. As the manufacturing sector failed to generate value-added that promotes economic growth and national income increase, ASEAN Four have so far yet to enter the high-income ranks. Drawing from the cases of ASEAN Four, this paper argues that the "middle technology trap" is a key contributing factor to the “middle income trap,” and countries fallen into the “middle income trap” often experience the "middle technology trap" as a concomitant phenomenon. The paper first introduces the industrialization process of ASEAN Four while analyzes the challenges they faced in industrial structural transformation and technology advancement. It then discusses major reasons that these countries failed to step over both the "middle technology trap" and the “middle income trap”, including limited technology spillovers from FDI, R&D investment shortages and insufficient industrial policies, low-quality education system, deficient intellectual property protection and underdeveloped regional capital markets. The paper concludes with some implications for China and discussion on potential future research on distinctions of the “middle technology trap” phenomenon between upper middle-income and lower middle-income countries.

Korean human resource management as number one: lessons for the Asia Pacific

ABSTRACT Despite the devastation caused by Japanese colonial rule and over three years of the Korean War, the Korean economy has created the Miracle on the Han River over the past half-century, joining the ranks of advanced nations. Although it started with low-wage and labour-intensive industries, the accumulation and utilization of human capital have prepared companies like Samsung Electronics, Hyundai Motor, Naver and Coupang for a new leap forward. However, global issues such as the climate crisis and sustainability, the dual labour market, adversarial labour relations and low birth rates with rapid ageing are new challenges for Korean-style HRM. This is a collection of articles dealing with the question of Korean HRM as a success factor of Korean development and a seed for problems destabilizing the Korean economic perspective in the 21st century.

Beneath the kiln: The unyielding spirit of women shaping rural India's brick tale

The brick industry, characterized as an informal and unorganized sector in India, has witnessed growth concurrent with urbanization across various states. This labor-intensive industry relies significantly on the widespread exploitation of women and children and heavily depends on migrant workers for production. This study aims to shed light on the current socio-economic conditions of women in the brick industries of Falta and Budge Budge-II C.D blocks in the South 24 Parganas District of Indian state West Bengal. The variables considered for this study encompass gender, age, marital status, nature of work, experience, education, income, benefits, and challenges —these factors serve as indicators of the socio-economic status of women in these manufacturing units. Environmentalists have identified the brick industry as one of the hazardous sectors with adverse implications for the health and physiological well-being of women and children. The present study is based on both primary and secondary data. The findings reveal that women in this field experience various forms of suffering, and the prevalence of child labor is notably high for both boys and girls in the brick kilns of these two blocks.