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Timothy J. Sturgeon

As the geographic fragmentation of industries has increased and cross-border coordination has improved, efforts to develop better measures and indicators of global value chains (GVC) have intensified. Producers of official and semi-official statistics and private market research information have gradually improved data resources available for GVC research, but the process is slow, piecemeal and incomplete. At the same time, demand for timely, policy-relevant GVC research is rising. This chapter describes several improvements in the data resources available for measuring GVCs that have arisen response to these new demands. Most prominent are international input–output tables such as the joint OECD–WTO Trade-in-Value-Added indicators, but several other GVC-relevant product groupings are being added to official statistics that will allow researchers to more easily retrieve comparable statistics on the outsourcing and offshoring practices of enterprises (business functions), trade in (ICT-enabled) services, and trade in intermediate goods and services that are likely to flow in more complex GVCs (specified intermediates). Finally, the chapter describes some key data resources available from private sources, and underscores the enduring value of qualitative field research and deep description of GVCs.

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Timothy J. Sturgeon and D. Hugh Whittaker

It is broadly recognized that GVCs have come to exert a major impact in developing countries. GVC scholarship has mainly focused on how power and governance are exerted in cross-border production networks, on detailing the specific characteristics and effects of GVCs across industries and countries and on identifying the possibilities and pressures for industrial, economic and social upgrading – or downgrading – in the places where they touch down. What has been left out is how to square GVCs with development theory, especially macro-historical narratives of development and the shifting roles for the state, notably the basket of industrial policies associated with successful examples of ‘late development’ in East Asia. The authors make the connection between GVCs and development through a two-step process. First, because the strategic drivers of GVCs have been insufficiently articulated in GVC literature, they offer an evolutionary framework that includes waves of new technology, organizational paradigms and management models. Second, they argue that these historical shifts have altered the conditions for development strategies, from early through late development, to a ‘network’ development era roughly coterminous and intertwined with the rise of GVCs: beginning in the 1970s and accelerating in the 1990s and 2000s. They call this era ‘compressed development’, and refer to countries that have become integrated into the global economy most recently as ‘compressed developers’. They argue that the opportunities and challenges of compressed developers differ in important ways from early and ‘late’ developers, with implications for the role of the state and industrial policy.

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Stefano Ponte, Timothy J. Sturgeon and Mark P. Dallas

Global value chain (GVC) analysis draws on international political economy, development studies, economic geography and economic sociology to provide insight into the transnational organization of economic activities and how these interact with local actors and institutions to shape development processes. GVCs in specific industries tend to be ‘governed’, more or less explicitly, by identifiable sets of ‘lead firms’ that select suppliers, place orders, set requirements, and sometimes tightly coordinate the activities of suppliers and affiliated companies. This approach to GVC governance has provided rich insights into the emergence of spatially dispersed yet centrally coordinated production and distribution networks. As important as firm-level actors and their inter-relationships are, it is evident that actors, institutions, and norms external to the value chain also shape GVCs governance, for example through regulation, lobbying, civil society campaigns, and third-party standard setting. Institutional actors, including states and multilateral institutions shape GVCs by providing a mechanism for signatories to enforce, or not enforce, regulations and a platform for negotiating the terms of international trade agreements. Workers can also influence governance, especially when they are represented by labour unions with the ability to negotiate the terms of employment or call work stoppages at the level of the enterprise, industry, or broader economy. To provide an expanded analytical toolkit for this expanding field of inquiry, we offer a typology of power in GVCs along two dimensions: the arena of actors (dyads and collectives) and the precision of power (direct and diffuse). This yields four main forms of power: bargaining (dyadic and direct), demonstrative (dyadic and diffuse), institutional (collective and direct) and constitutive (collective and diffuse). This typology can help isolate various forms of power, and how they layer, evolve, consolidate and diffuse through distinct mechanisms and trajectories in view of better understanding how are GVCs governed, and with what distributional effects.