Risks and Opportunities of Participation in Global Value Chains

Risk is inherent to the pursuit of opportunity. This paper surveys the recent literature and looks at the risks and opportunities firms and their workers face in the global value chains. First, it examines the risk-sharing mechanisms that firms provide from the national and global perspectives; second, it takes a closer look at the new opportunities and challenges for firms and individuals in the global arena; third, it discusses the role of economic upgrading and social upgrading; and finally it sheds light on how the government can help people manage risks and reap the benefits in the participation of global value chains

Microfoundations of global value chain research: Big decisions by small firms

In this study, we introduce a unique longitudinal dataset from the Italian Ministry of Economy and Finance Annual Survey (IMEFAS) to assess how micro and small enterprises (MSEs) partake in the global economy by tapping into global value chains (GVCs). The results of the empirical analysis show that the great majority of micro and small enterprises are unable to establish direct links with GVCs. However, two sub-categories of subcontractors and branded producers were able to accomplish upgrading and partake in GVCs after the 2008 economic crisis. For both groups of firms, strategies implemented in domestic value chains contributed to their future participation in GVCs. By identifying small firms' value chain decisions associated with their ability to access GVCs directly, this study sheds light on the microfoundations of GVCs. It paves the way for the future intersection of small business economics and GVCs, two areas of research that have seldom talked to each other

Reshoring by small firms: dual sourcing strategies and local subcontracting in value chains

This article assesses how the reshoring of manufacturing activities by micro and small enterprises (MSEs) affects the performances of co-located subcontracting networks and the reconfiguration of global value chains (GVCs). We utilize quantitative microdata of Italian MSEs operating in the clothing and footwear industries during the 2008-2015 period. Empirically MSE reshoring does not have a significant impact on domestic subcontractors' birth rates and survival chances, whereas it is positively associated with their productivity growth. Most MSEs in our sample adopt a dual sourcing strategy, expanding their global production networks while preserving their local supply base. Local and global production networks are not two alternative paradigms of industrial organization; they can be complementary and mutually reinforce each other

Cultivating compliance: governance of North Indian organic basmati smallholders in a global value chain

Focusing on a global value chain (GVC) for organic basmati rice, we study how farmers’ practices are governed through product and process standards, organic certification protocols, and contracts with buyer firms. We analyze how farmers’ entry into the GVC reconfigures their agencements (defined as heterogeneous arrangements of human and nonhuman agencies which are associated with each other). These reconfigurations entail the severance of some associations among procedural and material elements of the agencements and the formation of new associations, in order to produce cultivation practices that are accurately described by the GVC’s standards and protocols. Based on ethnography of two farmers in Uttarakhand, North India, we find that the same standards were enacted differently on the two farmers’ fields, producing variable degrees of (selective) compliance with the ‘official’ GVC standards. We argue that the disjuncture between the ‘official’ scripts of the standards and actual cultivation practices must be nurtured to allow farmers’ agencements to align their practices with local sociotechnical relations and farm ecology. Furthermore, we find that compliance and disjuncture were facilitated by many practices and associations that were officially ungoverned by the GVC

Analyzing food value chains for nutrition goals

First proposed in 2010, the use of ‘value chain analysis’ to identify opportunities for targeted nutrition interventions in food systems is still an emerging method. This review explores and summarizes the application of value chain analysis to nutrition and from this provides five insights into how to more effectively conduct value chain analysis for nutrition: 1) use a consumer perspective to inform selection of foods and chains; 2) consider the research question, available resources, and the type of chain; 3) situate consumer research at the center of the analysis; 4) assess economic trade-offs; and 5) pay attention to governance and stakeholders’ capacity for and incentives to change

Buyer Engagement and Labour Conditions in Global Supply Chains:The Bangladesh Accord and Beyond

The Accord on Fire and Building Safety in Bangladesh (‘the Accord’) has received both praise and criticism concerning its implications for corporate responsibility and power. This article contributes to the debate by situating the Accord within a broader set of activities that buyers are engaged in to promote better labour conditions in their supply chains. The authors identify three approaches of buyer engagement: auditing, capacity building and advocacy. Drawing on interviews conducted with European brands and retailers, the article shows how buyers perceive the merits and challenges of these approaches, and whether and how they discharge responsibility and power through these activities. The study shows that the Accord is seen primarily as part of the auditing approach with a key feature being its use of collective leverage as a means of enforcement. While greater buyer power has not necessarily been accompanied by greater responsibility, the article highlights heterogeneity among buyers in how they take up different approaches, painting a more nuanced picture of buyer responsibility and power

The southern African poultry value chain : corporate strategies, investments and agro-industrial policies

Abstract: Following various regional investments in the last decade, production and participation in the poultry value chain in southern Africa has increased. One of the factors that determines entry into, and success in, a global value chain is the governance structure. This paper adopts a modular approach to analyse the governance structures in the poultry value chains in Botswana, South Africa, Zambia and Zimbabwe. A key finding is that various stakeholders have an influence on the regional poultry value chain in southern Africa, with the sources of influence depending on the formality of structures within the value chain

Global investments and regional development trajectories: the missing links

Global investments and regional development trajectories: the missing links. Regional Studies. Regional economic development has been long conceptualized as a non-linear, interactive and socially embedded process: these features were traditionally regarded as spatially mediated and highly localized. However, unprecedentedly fast technological change coupled with the intensification of global economic integration has spurred the need to place regional development in a truly open and interdependent framework. Despite substantial progress in the academic literature, rethinking regional development in this perspective still presents a number of challenges in terms of concepts, empirical evidence and policy approaches. Following an interdisciplinary assessment of how openness and connectivity – proxied by one of the many cross-border flows, i.e., global investments – interact with regional economic development trajectories, this paper presents a picture of the geography of foreign investments from and to the European regions and its change after the financial and economic crisis in 2008. This simple exercise sheds some initial light on how the operationalization of regional connectivity can improve one’s empirical understanding of the evolution of regional economies and the policy approach needed to support their reaction to change