Handbook on Global Value Chains
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Handbook on Global Value Chains

Edited by Stefano Ponte, Gary Gereffi and Gale Raj-Reichert

Global value chains (GVCs) are a key feature of the global economy in the 21st century. They show how international investment and trade create cross-border production networks that link countries, firms and workers around the globe. This Handbook describes how GVCs arise and vary across industries and countries, and how they have evolved over time in response to economic and political forces. With chapters written by leading interdisciplinary scholars, the Handbook unpacks the key concepts of GVC governance and upgrading, and explores policy implications for advanced and developing economies alike.
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Chapter 8: Rents and inequality in global value chains

Raphael Kaplinsky

Abstract

This chapter explores the manner in which the global value chain framework can contribute to an understanding of the distribution of income. The core analytical concepts that further this analysis are various categories of rent and the barriers to entry that protect rents. This is followed by a description of four major distributional trends – in the global interpersonal distribution of income, in the class distribution of income, in the skills distribution of income and in the interfirm distribution of income. These two discussions are then drawn together to illustrate how the global value chain framework provides important insights into the distributional outcomes of global trade.

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