DSA2016: Politics in Development
Global value chains and production networks constitute the backbone of global trade and are subject to attention by both policymakers and political contestation. This 2 session panel explores the economic, social and environmental challenges of GPNs and their developmental policy ramifications.
Research on global production networks (GPNs) and global value chains (GVCs) has made major progress in going beyond nation state-centric accounts of trade to look at the roles played by specific actors, the governance relationships involved and implications for upgrading producers' development prospects. Initially focused on economic development outcomes, more recently research on GPNs and GVCs has also explored the social and environmental implications.
GVCs are now acknowledged by key international organisations as forming the backbone of the global economy. Recently, key reports by UNCTAD, the WTO, World Bank and African Development Bank have been centrally focused on GVCs and their potential to drive developmental outcomes. Whilst the increasing uptake of these frameworks can be exciting, concern has been expressed about selective application and interpretation by major policy organisations.
The purpose of the 2 proposed sessions is to provide critical reflections on the policies and politics of GPNs and GVCs, to reflect on attempts at understanding better, and engaging more effectively in, promoting positive local outcomes from global production.
We invite papers which could address, but are not limited to:
• Uptake and application of GVC/GPN frameworks by development policymakers
• Political contestation within and over GVCs/GPNs
• New private and public governance dynamics in global production networks, including the rise of new lead firms and impacts of industrial policy
• Ethical challenges within global value chains and production networks and related policies and politics of intervention
• Economic, social and environmental upgrading within global production networks the dynamics between each and related policy implications
This panel is closed to new paper proposals.
The politics of state governance in global production networks: insights from the South African fruit crisis.
The role of the state in the governance of global production networks is under-explored. Far from being passive actors, states actively adopt different kinds of governance functions. We highlight tensions within public governance and explore the politics of those tensions in South African fruit.
This paper explores the complex and multi-faceted role of the state and public governance in global production networks (GPNs). Such an agenda stems from what we perceive as an existing lack of engagement with politics and the central role of states as architects of GPNs. Whilst recent GPN scholarship has begun to incorporate the state and public governance into analysis, there is a tendency to perceive the state in economistic terms, largely passive and merely reactive to the power of economic actors in GPNs. Building on recent analytical insights, we advance our understanding of the state as an active political agent, with various governance functions (facilitative, regulatory and distributive) in the GPN. This analytical framing helps elucidate the dynamic and contested nature of state governance, both internally and in relation to private GPN actors.
We explore how the politics of state governance play out in a particular political-economic context: the South African fruit sector, and in particular a labour crisis that occurred in 2012/13. Adopting a political-economic perspective, we reveal tensions within state governance and the politics of those tensions in GPNs. The contribution of the paper is two-fold. Firstly, our analysis sheds important light on the 2012/13 labour crisis in South African fruit, and the tensions that emerged within state governance processes and between state, private, civil society actors and labour in the GPN. Secondly, we offer critical analytical insights into the complex and multi-faceted role of the state, highlighting the importance of re-integrating politics into questions of governance in GPNs.
Should GVC policies target locally-owned firms? A tale of two sectors from Malaysia
The debate over state intervention for GVCs rarely addresses whether policies should target locally-owned firms. A study on Malaysia’s upgrading performance, which finds capability gaps between locally-owned firms from E&E and palm oil sectors due to different sectoral policies, holds some answers.
Government's role in promoting productivity growth and technological change in national sectors is a contentious subject. The debate mainly surrounds the raison d'être for state interventions variedly referred to as industrial, innovation or technology policies, as well as the efficacy and implications of favouring certain sectors over others. Subsumed under the debate is a relevant aspect that is not addressed explicitly: should sector-specific policies target locally-owned firms? To attempt the question, our study examines upgrading performance of Malaysia's electrical and electronics (E&E) and palm oil sectors at both sectoral and firm levels. Our fieldwork draws on primary data gathered from interviews with firms and government officials as well as secondary data from statistical sources and industry publications. We find that government policies had historically induced upgrading at the sectoral level for both sectors. Over time, significant capability gaps emerged between locally-owned firms from the two sectors, in tandem with their respective policy emphases and institutional arrangements. Locally-owned oil palm-based firms have evolved into lead firms or competitors to foreign firms within segments of palm oil GVCs in which they had little presence initially. In contrast, locally-owned E&E firms still occupy less sophisticated segments of their value chains such as assembly as well as test and engineering services. This, in turn, constrains the options for future sectoral upgrading in the E&E sector. The results highlight the need for policies and research to consider firm type more closely, in addition to other aspects of the ongoing debate.
Upgrading in South-South Global Value Chains: How participation in different trade-trajectories affect suppliers in the Kenyan leather sector
This study looks at a value chain that is experiencing a process of “globalisation” in multiple trajectories (north; south; region) to assess whether and how different end markets affect local suppliers’ capacity to upgrade both economically as well as in terms of functions, products and processes.
Globalisation has been characterised by a phenomenon of integration through disintegration whereby increasing trade has been accompanied by a breaking-up of value chains across countries. Within a logic of export-oriented development, developing nations have seen participation into GVCs as a unique opportunity to relocate productive activities inside their borders, supporting not only economic growth but also better social standards. This notwithstanding, GVCs scholars have recently questioned the occurrence of this pattern, noticing how dependence on external buyers in developed countries locks developing countries' suppliers into low-skilled/labour intensive activities, preventing them from developing the institutions and know how required to move into higher stages of value creation. Whereas most of the literature has been concentrating on governance dynamics within South-North value chain, less attention has been paid to the recent surge in South-South trade that has accompanied the constitution of South-South and Regional value chains. Drawing on recent literature on trade and GVCs, this study proposes a mixed methodology combining qualitative and quantitative methods of data analysis to assess different level of governance and upgrading across three trade trajectories in the Kenyan agro-based leather industry - south-north; south-south; and regional. Provisional results show how regional markets have a different impact on local suppliers compared to other large scale Southern economies such as China and India, as well as traditional European end-markets. Moreover, a set of interviews among Kenyan tanners show how functional upgrading is a factor that depends more on upstream rather than downstream relations, and how considerations of learning myopia may explain upgrading trajectories better than a restricted governance-based approach
Global decisions and local realities: the politics and policies of upgrading and their implications in agricultural global production networks
This paper argues that global and particularly Northern policy and politics shaping certification choices affect the local realities of Southern producers, drawing on two-case studies in agricultural global production networks involving fresh fruit and vegetables in Kenya and cocoa in Nicaragua.
As certification is proving ever more popular as a particular manifestation of economic, social and environmental upgrading, this paper seeks to explore the processes of policy and politics which shape stakeholder certification choices in global production networks, and the implications which this interconnectedness entails for farmers' realities. The paper introduces two case-studies, the production of fresh fruit and vegetables in Kenya and the cocoa sector in Nicaragua. The case-studies underscore how the complex connections between the different dimensions of the economic, social and environmental aspects of private voluntary standards, as well as the politics surrounding standards' uptake, will impact local outcomes for farmers. In the case of cocoa, both public-policy concerns regarding food safety and political momentum supporting government-led cocoa sustainability initiatives influence private-sector choices regarding certification. For the case of fresh fruit and vegetables, the combination of environmental, social and economic certification requirements including public food safety concerns is an outcome of private and public-sector policies: they shape farmers' realities and their ability to participate in global production networks. The paper argues that the intricate dynamics of policy and politics shaping certification choices by public-sector, private-sector and civil-society stakeholders in the global North have implications for Southern farmers' local realities, emphasising the need for careful consideration if local outcomes are to be improved.
Virtual Production Networks: Fixing Commodification and Disembeddedness
Online outsourcing platforms organize, commodify and disembed labor in an extreme and distinctive manner. Although virtual production is disembedded they are not immaterial or ethereal. We argue spatio-temporal fixes provide a useful alternative to the existing GPN use of embeddedness.
This paper highlights the strengths and benefits of the Global Production Network (GPN) approach. However, it also raises a concern that the manner in which embeddedness has been utilized within this paradigm is possibly ill-suited to arenas of virtual production in which commodification is heightened. In fact, to fully account for the uniqueness of virtual production we demonstrate that the GPN model requires significant extension and reformulation. This is the aim of this paper and in doing so we develop a new model of 'Virtual Production Networks' (VPNs). At the core of our VPN model is an original account of the distinctive manner in which online outsourcing platforms organize, commodify and disembed labor. Drawing upon detailed empirical research we conceptually map VPNs providing an original typology and highlighting the ways in which online outsourcing platforms are engineered and framed in an effort to disembed labor from the laws, institutions and norms. Although VPNs are disembedded they are not immaterial or operating in some kind of ethereal alternative dimension. Spatio-temporal fixes provide an alternative to the existing GPN use of embeddedness. We elucidate the manner in which disembedded - i.e. highly commodified - virtual production is fixed within regional, nation and local social networks. In fact, these spatio-temporal fixes enable the overcoming of a number of contradictions created by commodification. We conclude by considering the implications this has for social upgrading.
Labour control and the labour question in commodity chains: exploitation and disciplining in Senegalese export horticulture.
This article examines the historical evolution of local labour control regimes upstream the Senegalese-European horticultural commodity chain. It shows that labour control emerges from the combined pressures of foreign firms, international institutions, the state, and households.
This article engages with the GVC/GPN literature, labour process analysis, and agrarian political economy to analyse labour control in the Senegalese-European horticultural commodity chain. It examines the historical evolution of local labour control regimes in the Senegalese countryside as mechanisms organising production and regulating the labour process within local farms, and resulting from the combined pressures emanating at the local, national, and global scales. Labour control is further conceptualised through the interplay of labour exploitation (the production of value in excess of labour remuneration) and labour disciplining (the mechanisms of containment and prevention of labour resistance, i.e. the constant subordination of labour to the labour process).
The drivers for labour control span the boundaries of local farms as the concrete architectures of LLCR result from the combined pressures of foreign firms, international institutions, the state, and households. The pervasive influence of the state links labour control within farms to a broader 'labour question'. The contradictory need to control labour drives firms' pressures to internalise and externalise labour control as farms periodically shift between, or combine, estate farming (direct production) and contract farming (outsourcing). Underpinning these shifts is the broad disciplining of labour, both social (articulated through gender relations and paternalism) and spatial (splintering of the labour force through outsourcing).
Putting the Public back into Private Governance - The Importance of Public Policy for Labour Standards in Apparel and Footwear Global Production Networks
An effort of incorporating the importance of public governance into the debate on efficacy of private labor governance, examining different levels of public governance and interaction through the use of quantitative and qualitative methods.
The impact and efficacy of private governance on international labour standards remain variables which are extremely difficult to estimate, let alone measure. The debate surrounding relevant impact factors focusses on two main areas: the study of environmental variables regarding social and economic upgrading on the one hand, and the analysis of firm- and value-chain specific characteristics on the other hand. Both discourses aim at framing the success or failure of private governance initiatives in a more meaningful way. I argue in this paper that it is however only the combination of these two areas which can lead to a complete understanding of governance effects towards global labour standards. Using a dataset of over 1000 encoded tracking charts of the Fair Labour Association in the apparel- and footwear industry, this article examines in how far the success of private governance is dependent on the national regulatory system of supplier- and buyer-countries. Institutional variables are used to establish benchmark differences of compliance within national regulatory systems, whereas a deep-dive into some distinctive national cases within the data serves a more thorough qualitative understanding of regulatory systems. With this, the article aims to answer the following questions: Is there evidence indicating that certain national regulatory systems are more or less decisive for the success of private governance, and how do private and public governance interact? Is there a buyer related country-of-origin effect? And finally, in how far does international public regulation interact with the relationship between public and private governance?
CSR standards in China: Social upgrading and industrial policy goals in GPNs
This paper argues that the emergence of Chinese CSR standards needs to be seen in the wider context of China’s changing industrial policy objectives in GPNs. It shows how the evolution of Chinese CSR standards corresponds to a shift from structural strategic coupling towards functional coupling.
China's rapid growth over the last three decades has been based to a significant extent on exports of cheap, labour-intensive manufactures through global production networks (GPNs). Hence, demands for compliance with social standards from multinational companies and NGOs were initially perceived as a threat to the competitiveness of Chinese suppliers. However, local corporate social responsibility (CSR) standards adopted by Chinese institutions are proliferating, including both general national CSR standards and sector-specific guidelines promoted by industry associations. Hence, promoting social upgrading among Chinese suppliers of garments or electronics has evolved from an issue of concern for anti-sweatshop NGOs in European and American markets into a policy goal supported by official institutions within China.
This paper argues that this shift needs to be seen in the wider context of China's changing industrial policy objectives on strategic coupling in GPNs (Coe & Yeung, 2015). Based on a review of literature, policy documents and interviews with CSR experts in China, the paper finds that the evolution of Chinese CSR standards corresponds to a shift from structural strategic coupling towards functional coupling (Coe & Yeung 2015), associated with increased policy attention on enhancing local skills and technology. Taking the case of the textile and apparel sector as an example, the paper illustrates how the adoption of China's first CSR management system has taken place in a context of shifting strategic coupling objectives.
This panel is closed to new paper proposals.