Integrated Trade  with Disintegrated Production  in the Context of Global  Value Chains

Zsuzsanna Eszter Szalay

Published : 2015-12-30

Vol. 6 No. 17 (2015)

Integrated Trade with Disintegrated Production in the Context of Global Value Chains

Zsuzsanna Eszter Szalay

Section: Thematic Articles

Abstract

The objective of this paper is to show how the global value chain (GVC) concept has spread since the early 2000s. The article assumes that GVC is no longer just a concept or an analytical framework; rather that a new type of business unit has emerged. The article is based on the literature comparison which served to search the main decision-making criteria. The article found that the main decision-making criteria are based on the economies of a network, behind which the spirit of informationalism can be found. The connection between Powell’s stylized models of markets, hierarchy, networks and Gereffi’s theoretical framework of governance structure at GVCs was discovered. The Powell-Gereffi combined model represents clearly described modalities of governance. The paper asks whether the entire economic system is covered by the Powell-Gereffi division. Kornai and Braudel both recognized the routine functioning of the basic-economy, without which the whole economy would lose its stability. It is necessary to formulate how this vegetative or infra-economy relates to the GVCs and to our globalized world economy. The article interprets the Smile Curve, and determines a possible way of measuring the distortion of smile.

Keywords

network ; global value chain (GVC) ; infra-economy ; geopolitics ; geoeconomics

Details

References

Indicators

Authors

Download files

PDF (Język Polski)

Zasady cytowania

Altmetric indicators

Licence

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Authors who publish with this journal agree to the following terms:

Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a CC BY-ND licence that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
Authors are asked to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.

Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access). We advise to use any of the following reserach society portals:

References

Baldwin, R., 2009, Integration of the North American Economy and New-paradigm Globalization, WP 049, Graduate Institute, Geneva, <http://graduateinstitute.ch/files/live/sites/iheid/files/sites/ctei/shared/CTEI/Baldwin/Publications/Chapters/Regionalism/Integration%20of%20the%20North%20American%20economy%20and%20the%20new%20globalisation%20paradigm%20%28Baldwin%29.pdf>.

Baldwin, R., 2012, Global Supply Chains: Why They Emerged, Why They Matter, and Where They Are Going, Fung Global Institute, <https://ideas.repec.org/p/cpr/ceprdp/9103.html>.

Barabási, A-L., 2002, Linked: How Everything Is Connected to Everything Else, PenguinBooks.

Braudel, F., 1967, Civilisation matérielle, économie et capitalisme, XVe-XVIIIe siècle, Vol. 1: Les structures du quotidien.

Braudel, F., 1977, Afterthoughts on Material Civilization and Capitalism, transl. P.M. Ranum, The Johns Hopkins University Press, Baltimore and London, p. 81, <http://www.scribd.com/doc/47156827/Braudel-F-1977-Afterthoughts-on-Material-Civilization-and-Capitalism>.

Braudel, F., 1979, Civilization and Capitalism, 15th–18th Centuries, transl. by S. Reynolds, 3 vols., vol. 1: The Structures of Everyday Life.

Braudel, F.,1985, Anyagi kultúra, gazdaság és kapitalizmus XV−XVIII. század, Gondolat, Budapest, első kötet: A mindennapi élet struktúrái: a lehetséges és a lehetetlen, Gutta Könyvkiadó 2004.

Czakó, E., (ed.), 2014, A globális értékláncok – a multinacionális vállalat, mint globális gyár [Global Value Chains – Multinational Enterprise, as Global Factory], Working Paper, Institute of Business Economics, No. 155, <http://unipub.lib.uni-corvinus.hu/1586/1/Nkzi_PhD_MUHELY_2013_2014%20vegso.pdf>.

Castells, M., 1998, The Information Age: Economy, Society and Culture Vol. I The Rise of the Network Society, 2nd ed. in: 2000, End of Millennium, Malden, MA; Oxford, UK: Blackwell.

de Backer, K., 2013, OECD Work on Global Value Chains and Trade in Value Added, Bruegel workshop, Brussels, 27 June, <http://www.bruegel.org/fileadmin/bruegel_files/Events/Presentations/130627_de_backer.pdf>.

De Backer, K., Yamano, N., 2012, International Comparative Evidence on Global Value Chains, OECD, <http://dx.doi.org/10.1787/5k9bb2vcwv5j-en>.

Dobos, I., Szalay, Zs., 2011, The Closed Loop Model by Regional Economics or How Big is the Ants’ Footprint?, Third Annual Conference on Globalization, Sustainability and Development, May 4-7, Gödöllő / Budapest, Hungary, <http://unipub.lib.uni-corvinus.hu/442/1/Dobos_Szalay_2011.pdf>.

Grodzicki, M.J., 2014, Global Value Chain and Competitivness of V4 Economics (chapter 1), in: Kiendl-Wendner, D., Wach, K., (eds.), International Competitiveness in Visegrad Countries: Macro and Micro Perspectives, Fachhochschule Joanneum, Graz, <http://www.visegrad.uek.krakow.pl/PDF/Graz2014_ch01_grodzicki.pdf>.

Gereffi, G., 1994, The Organisation of Buyer-driven Global Commodity Chains: How U.S. Retailers,Shape Overseas Production Networks, in: Gereffi, G., Korzeniewicz, M., (eds.), Commodity Chains and Global Capitalism, CT: Praeger, Westport, pp. 95-122.

Gereffi, G., Humphrey, J., Kaplinsky, R., Sturgeon, J., 2001, Introduction: Globalisation, value chains and development, “IDS Bulletin” 32 (3), pp. 1-8, <https://www.ids.ac.uk/files/dmfile/gereffietal323.pdf>.

Gereffi, G., Humphrey., J., Sturgeon, J., 2005, The Governance of Global Value Chains, “Review of International Political Economy” 12, 1, pp. 78-104, <http://www.rrojasdatabank.info/sturgeon2005.pdf>.

Gereffi, G., 2012, New Trends in Value Chain Upgrading: Lessons from Large and Small Countries, US International Trade Comission Washington, DC, <http://www.usitc.gov/research_and_analysis/gvc.pdf>.

Goeltz, D.R., 2014, Globalization and hypercompetition – Drivers, linkages, and industry differences, “Journal of International Business and Cultural Studies”, Vol. 8, <http://www.aabri.com/manuscripts/141856.pdf>.

Jain, V.K., Raghunath, S., 2013, Strengthening America’s International Competitiveness through innovation and global value chains, in: Kedia, B.L., Jain, S.C., (eds.), Restoring America's Global Competitiveness through Innovation, pp. 252-274.

Kaplinsky, R., 2013, Global Value Chains, Where They Came From, Where They Are Going and Why this is Important, IKD Working Paper No. 68, <http://www.open.ac.uk/ikd/documents/working-papers/ikd-working-paper-68.pdf>.

Kornai, J., Martos, B., 1971, Gazdasági rendszerek vegetatív működése [Autonomous Control of Economic Systems], “Szigma”, Vol. 4, No. 1-2, pp. 35-50, in English: 1973, <http://www.jstor.org/stable/1913373>.

Kornai, J., Martos, B., 1981, Non-price control, Akadémia.

Mudambi, R., 2008, Location, control and innovation in knowledge – intensive industries, “Journal of Economic Geography”, <http://joeg.oxfordjournals.org/content/8/5/699.full>.

OECD, 2013a, Interconnected Economies: Benefiting from Global Value Chains, OECD Publishing.

OECD, 2013b, Interconnected Economies: Benefiting from Global Value Chains, Forward, OECD Publishing, <http://www.oecd-ilibrary.org/trade/interconnected-economies/foreword_9789264189560-1-en>.

Porter, M.E.,1985, Competitive Advantage. Creating and Sustaining Superior Performance, The Free Press, New York.

Powell, W.W., 1990, Neither market nor hierarchy: Network forms of organization, in: Staw, B.M., Cummings, L.L., (eds.), Research in Organizational Behavior, JAI, pp. 295-336, <http://web.stanford.edu/~woodyp/papers/powell_neither.pdf>.

Ricardo, D., 1817, On The Principles of Political Economy and Taxation, Batoche Books, 2001, <http://socserv.mcmaster.ca/econ/ugcm/3ll3/ricardo/Principles.pdf>.

Szalavetz, A., 2013, Szolgáltatás jellegű vállalati tevékenységek fogoly típusú kiszervezése - funkcionális feljebb lépés a hazai feldolgozóipari leányvállalatok szemszögéből. (Captive Offshoring of Functions – Functional Upgrading at Manufacturing MNCs’ Hungarian Subsidiaries) Külgazdaság, 57 (5-6), <http://real.mtak.hu/8060/1/Szalavetz5-6K%C3%BClg2013.pdf>.

Timmer, M.P., Erumban, A.E., Los, B., Stehrer, R., de Vries, G., 2012, New measures of European Competitiveness: A Global Value Chain Perspective, <http://www.wiod.org/conferences/brussels/Timmer_background.pdf>.

UNCTAD, 2013, World Investment Report 2013, Chapter IV, <../../PT/AppData/Local/Temp/httphttp://unctad.org/en/publicationslibrary/wir2013_en.pdf>.