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Book part
Publication date: 6 November 2018

Natalia Volgina

One of the most important economic processes in the world economy over the recent decades has been increasing fragmentation of international production that resulted in…

Abstract

One of the most important economic processes in the world economy over the recent decades has been increasing fragmentation of international production that resulted in expansion of global value chains (GVCs). National economies started to get involved in GVCs in order to get value-added gains from this participation; Russia is not an exception. To analyze Russia’s GVCs participation, we need to adopt new statistical methodology based on input–output approach that allows estimating trade flows in terms of value added, including foreign and domestic value added as parts of gross exports. The author comes to the conclusion that Russia’s participation in GVCs was growing during the last decades mostly by forward participation connected with supply of oil and gas along GVC; moreover, Russia had net gains from this participation. Future trends in Russia’ involvement in GVCs can be described by two scenarios. The first one is based on expanding forward manufacturing participation in order to increase and diversify nonoil exports. This scenario is strongly supported by Russian Federation Ministry for Economic Development. The second scenario covers the continuation of mineral participation in GVCs that Russia implements till now. Both scenarios have their pro and contra. The author argues that the first scenario is better correlated with long-term economic interests and possibilities for sustainable development in Russia.

Book part
Publication date: 14 October 2015

Umair Shafi Choksy

The purpose of this research is to understand how power relations in global value chains (GVCs) shape the upgrading of offshoring service providers (OSPs). More…

Abstract

Purpose

The purpose of this research is to understand how power relations in global value chains (GVCs) shape the upgrading of offshoring service providers (OSPs). More specifically, the chapter addresses two questions: (1) How power asymmetry in GVC shapes the upgrading prospects for OSPs? and (2) How OSPs manage the power asymmetry in GVC and upgrade to a more favorable position?

Methodology/approach

The context for this study is the software value chain. Drawing upon relational economic geography and GVC literature, we build an analytical framework based on three conceptual building blocks: client power, upgrading, and upgrading practices. Based on the analytical framework and in-depth interviews, we design a case study of one OSP in the Pakistani software industry, referred to as OSP#A.

Findings

The findings reveal that GVCs exercise a high level of power on OSPs. This power is exercised through enforcing certain conditions to participate and coordinate in GVCs. However, it is found that OSP#A is not passive recipient of these demands. Instead, it actively manages the power asymmetry through building practices to adapt and collaborate in GVCs and attain relational proximity.

Originality/value

The chapter highlights the significance of upgrading practices and conceptualizing upgrading as a process of improving relational power in GVCs by attaining relational proximity.

Details

The Future of Global Organizing
Type: Book
ISBN: 978-1-78560-422-5

Keywords

Article
Publication date: 11 May 2021

Ismail Gölgeci, David Marius Gligor, Ewelina Lacka and Jawwad Z. Raja

This paper examines the servitization phenomenon in the context of global value chains (GVCs) and presents a conceptual framework by connecting the two literature…

Abstract

Purpose

This paper examines the servitization phenomenon in the context of global value chains (GVCs) and presents a conceptual framework by connecting the two literature streams—servitization and GVCs—to depict the interconnected multilevel processes by which the influence of servitization on GVC structure and governance is manifested.

Design/methodology/approach

Drawing on cross-disciplinary literature, the authors develop a multilevel conceptual framework. The theoretically informed framework advances research on servitization and GVCs and provides a line of inquiry to be explored as avenues for future research opportunities.

Findings

The authors argue that servitization instigates the formation of new ecosystems and collaborative structures within GVCs, reduces the fragmentation of the overall network structure and increases embeddedness within the subclusters of GVCs. These changes are expected to be reflected in the increase in the complexity of firms' GVC governance tasks, a greater reliance on relational governance, and an increase in the dependency on local partners in terms of the governance of GVCs.

Originality/value

This conceptual paper establishes the link between servitization and GVCs, anchors the servitization phenomenon in GVCs, explains how servitizing firms can engage in and shape GVCs and offers insights into the servitization-driven changes in GVCs. The conceptual framework is intended to lay the foundation for future empirical research on the link between servitization and GVCs.

Details

International Journal of Operations & Production Management, vol. 41 no. 5
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 5 June 2017

Masato Abe and Marc Proksch

Global value chains (GVCs) have become increasingly influential in determining the patterns of international trade and foreign direct investment (FDI) and in providing…

Abstract

Purpose

Global value chains (GVCs) have become increasingly influential in determining the patterns of international trade and foreign direct investment (FDI) and in providing growth opportunities in Asia and the Pacific while small- and medium-sized enterprises (SMEs) have been an engine of economic development. The purpose of this paper is to provide effective development strategies and relevant policy approaches to facilitate dynamic insertion of SMEs into GVCs.

Design/methodology/approach

This paper was developed based on various Economic and Social Commission for Asia and the Pacific works in the fields of the development of SMEs and GVCs in Asia and the Pacific. Sectoral case studies on agribusiness, garment/apparel, automotive and electronics illustrate SMEs’ effective integration into GVCs.

Findings

SMEs face multiple obstacles and challenges which may limit the benefits derived from the development of GVCs in Asia and the Pacific. Policymakers are suggested to design and implement appropriate strategies and polices in order to facilitate the development of SMEs under the ongoing globalization.

Research limitations/implications

This paper is mainly based on existing policy papers which were developed by the United Nations Secretariat, its specialized agencies and others. Further empirical and policy studies are expected to be conducted in order to deepen the understanding of the present topics and to come up with practical policy options.

Practical implications

Policymakers are suggested to consider strategies and policy options recommended by this paper for their works on SME development and trade and investment promotion.

Originality/value

This is the first policy paper which proposes a comprehensive framework for SMEs’ effective participation in GVCs, specifically suggesting seven approaches, namely, SME development; trade policy; behind-the-border and cross-border trade facilitation; regional integration frameworks; FDI promotion; SME clusters; and national innovation system.

Details

Journal of Korea Trade, vol. 21 no. 2
Type: Research Article
ISSN: 1229-828X

Keywords

Article
Publication date: 24 July 2020

Jingqin Su, Huanhuan Ma and Shuai Zhang

In the face of fierce international competition for those participating in global value chains (GVCs), upgrading has been a central concern of emerging market firms (EMFs…

Abstract

Purpose

In the face of fierce international competition for those participating in global value chains (GVCs), upgrading has been a central concern of emerging market firms (EMFs) that are trying to occupy higher value-added positions. However, although the innovation capabilities (ICs) have been generally considered critical to upgrading in GVCs, few studies have examined how IC is built up and then applied to the EMF upgrading process over time. To this end, the purpose of this paper is to investigate why and how EMFs can upgrade in GVCs through the development of their IC.

Design/methodology/approach

This paper adopts a multiple-case study of three supplier firms in China and their IC development processes, with a special focus on the nature of the firm-level upgrading in GVCs.

Findings

The results generate a process model of EMFs upgrading with respect to the development of IC. The model reveals how IC is built up through the firms' underlying systematic innovation activities, which enable firms to successfully upgrade within GVCs. In particular, the role played by contextual vulnerability in guiding firms to develop the appropriate IC, and the corresponding upgrading, is highlighted.

Research limitations/implications

This study contributes to the micro-foundation in GVCs literature, especially the traditional static upgrading research of EMFs. The authors also contribute to existing IC development research. Meanwhile, the study focuses on the upgrading of three Chinese firms in the phone and LED industries. The generalizability to other emerging markets and industries may therefore be limited.

Practical implications

The study results show that EMFs could initially develop endogenous IC that focuses on process innovation as a means to establish a foundation for further upgrading. In addition, firms need to improve their ability to accurately sense contextual changes. As such, it would be valuable to understand their positions and characteristics within GVCs.

Originality/value

This paper investigates a process model of upgrading in GVCs through IC development in EMFs. This study also adds a dynamic micro-foundation to existing, rather macro and static GVCs studies.

Details

International Journal of Emerging Markets, vol. 16 no. 8
Type: Research Article
ISSN: 1746-8809

Keywords

Open Access
Article
Publication date: 6 May 2020

Merel Serdijn, Ans Kolk and Luc Fransen

Amidst burgeoning attention for global value chains (GVCs) in international business (IB), this paper aims to identify a clear “missing link” in this literature and…

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Abstract

Purpose

Amidst burgeoning attention for global value chains (GVCs) in international business (IB), this paper aims to identify a clear “missing link” in this literature and discusses implications for research and corporate social responsibility (CSR) policy-making and implementation.

Design/methodology/approach

The paper combines an overview of relevant literature from different (sub)disciplinary fields, with insights from practitioner and expert interviews and secondary data.

Findings

Because IB GVC research stems from a focus on lead firms and their producing suppliers, it lacks attention for intermediary actors that may significantly impact the organization of production in general, and firms’ CSR commitments in particular. Import intermediaries are often “hidden” in GVCs. This paper indicates the emergence of GVC parallelism with “frontstage” chains managed by lead firms and increasingly exposed to public scrutiny following calls for transparency and CSR, and “backstage” ones in which buyers and intermediaries operate more opaquely.

Practical implications

This study points at salient yet little known practices and actors that influence the organization of production and the implementation of CSR policies in various ways, and therefore offers ground for reflection on the design of proper supply chain and CSR policies.

Originality/value

This study exposes a hitherto neglected category of actors in GVCs and broader IB research and discusses implications, relevance and areas for further investigation. An illustrative example explicates the importance of carefully considering this “missing link”. The study emphasizes the need for further study into ways in which both lead firms and intermediaries deal with contradicting demands of implementing CSR policies and offering competitive prices with short lead times.

Book part
Publication date: 30 September 2021

Andrea Ricci

In recent decades, capitalist globalization has entailed a new international division of labor with the relocation of some stages of manufacturing production from the…

Abstract

In recent decades, capitalist globalization has entailed a new international division of labor with the relocation of some stages of manufacturing production from the Center to the Periphery through the Global value chains (GVCs). This new pattern of global production is marked by wide income disparities between the different regions of the world economy, accentuated by value transfers hidden within both traditional and GVCs international trade. The chapter presents a theoretical model based on a Marxian approach for the accounting of unequal exchange in international trade in value-added, resulting from the decoupling of value-produced and value-captured inside and outside GVCs. The empirical results show the ongoing relevance of unequal exchange in contemporary capitalism as one of the fundamental causes of disparities in income and economic development among the countries of the global economy.

Article
Publication date: 13 February 2019

Jana Vlckova and Bublu Sarbani Thakur-Weigold

Medical technology (MedTech) is a growth industry, which like other manufacturing sectors has undergone fragmentation of production and emergence of Global Value Chains

Abstract

Purpose

Medical technology (MedTech) is a growth industry, which like other manufacturing sectors has undergone fragmentation of production and emergence of Global Value Chains (GVCs). The purpose of this paper is to compare how two open European economies position themselves competitively within MedTech GVCs: highly developed Switzerland and the emerging Czech Republic.

Design/methodology/approach

The research applies a mixed methodology to analyze the performance of each location in the MedTech GVCs. It draws on macroeconomic, industry, trade and a proprietary sample of firm data, combined with onsite interviews.

Findings

The economic outcomes and GVC positions differ in both cases, whereas Switzerland focuses on high value-added activities such as R&D and after-sales service. Specialized manufacturing is also located here in spite of high costs. By contrast, the Czech Republic focuses mostly on low value-added activities, like manufacturing disposables, although some domestic innovative companies are notable. The authors generalize four types of firms in the industry, comparing their presence in both locations.

Practical implications

The competitive positions and challenges faced by each location when engaging in MedTech GVCs are summarized and related to economic outcomes. In the Czech Republic, the barriers to upgrading include its business environment, and weak links between education institutions and industry. Switzerland’s high cost structure is offset by adding high value in core competencies. Both countries should protect the inherent advantage their locations offer within responsive European supply chains.

Originality/value

GVC research in the MedTech sector has been limited. There is no comparison of two European countries, and their position in MedTech GVCs, nor of how firms, participate successfully in them.

Details

International Journal of Emerging Markets, vol. 15 no. 1
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 29 September 2020

Marie-Christin Schmidt, Johannes W. Veile, Julian M. Müller and Kai-Ingo Voigt

The study analyses how Industry 4.0 and underlying digital technologies influence the design of ecosystems in global value chains (GVCs).

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Abstract

Purpose

The study analyses how Industry 4.0 and underlying digital technologies influence the design of ecosystems in global value chains (GVCs).

Design/methodology/approach

A qualitative-exploratory research design is used. It deploys a multiple case study based on semi-structured interviews with 73 German managers of multinational enterprises. Applying a qualitative content analysis, the expert interviews are inductively analyzed and triangulated with secondary data to develop a synthesized data structure.

Findings

The analysis reveals a general tendency towards decentralization of value chain activities. Depending on the nature of each activity and several contextual factors, however, hybrids between centralization and decentralization of processes can be observed in Industry 4.0 environments. Consequences for global ecosystems are altered cooperation with business partners, new organizational forms and novel market environments.

Research limitations/implications

Given inherent limitations in scope and methodology, the study calls for cross-industry and cross-country analyses. Further studies should research implications of Industry 4.0 changes in ecosystems and GVCs, and the role digital platforms can play in this context.

Practical implications

The results help companies to analyze and adapt their role in ecosystems and associated GVC activities to Industry 4.0 environments, thus staying competitive in changing market conditions.

Originality/value

This study is among the first to empirically investigate the influence of Industry 4.0 on ecosystems embedded in GVCs. Reflecting existing company environments, it adds an international and company-external perspective to Industry 4.0 research.

Details

The International Journal of Logistics Management , vol. 32 no. 4
Type: Research Article
ISSN: 0957-4093

Keywords

Article
Publication date: 7 October 2021

Dung Phuong Hoang, Ngoc Thang Doan and Thi Cam Thuy Nguyen

Upgrading in global value chains (GVCs) has become a crucial strategy for enhancing competitive advantage and attaining higher profitability, especially among firms in…

Abstract

Purpose

Upgrading in global value chains (GVCs) has become a crucial strategy for enhancing competitive advantage and attaining higher profitability, especially among firms in developing countries. Drawn from the sociological approach, this study treats GVC upgrading as an entrepreneurial act and examines factors affecting firms' intention to move up in their chains based on the theory of planned behavior. The authors also further test the moderating effects of firms' knowledge about rule of origin and governmental supports on the intention-behavior gap.

Design/methodology/approach

In-depth interviews with eight Vietnamese business managers were implemented to support the development of hypotheses and measurement scales. Afterwards, the authors conducted a survey on decision-makers of 402 Vietnamese firms which currently have export-import activities to collect quantitative data for testing the hypothesized relationships.

Findings

The empirical results indicate that both attitudes, behavioral control and social norms have significant positive impacts on the intention to upgrade in GVCs. In turn, such intention could further activate actual behaviors to move up in their chains. However, those who have better knowledge about rule of origin and receive governmental supports either in terms of finance, credit or technology have a higher probability of demonstrating actual behavior to upgrade in GVCs once their intentions are formed than those who do not.

Practical implications

This research provides valuable implications for policymakers in accelerating firms' actions to upgrade within their chains, hence, actively enhancing not only organizational performance but also significantly contributes to the national economic development.

Originality/value

While most of the previous studies examine the preconditions for firms to participate and upgrade in their GVCs, there is limited attention on determinants of firms' own intention and actual behavior to upgrade in their chains once they have participated in the GVC. Specifically, this research not only contributes to the existing knowledge regarding factors affecting firms' intention to upgrade in their chains but also closes the gap between the intention and the actual GVC upgrading behavior.

Details

Asia Pacific Journal of Marketing and Logistics, vol. 34 no. 7
Type: Research Article
ISSN: 1355-5855

Keywords

1 – 10 of 210