Competitiveness and Technological Upgrading in Global Value Chains: Evidence from the Indonesian Electronics and Garment Sectors

Indonesia is a rapidly growing and internationally competitive economy that is well integrated into globalized production systems. The global value chain (GVC) model has proven to be a popular analytical framework to explain how global lead firms structure and organize global production through dispersed global suppliers. Indonesia's leading export sectors, garments and electronics, are well integrated into GVCs. Engagement in GVCs, often led by leading global brands, is seen as a basis for local producers to become globally competitive and to grow. It also comes with challenges—local producers must meet the demanding pressures from lead firms on prices, on-time delivery, product quality, and social, environmental and labour standards. The possibilities for local producers to learn, acquire new capabilities and upgrade to enhance their competitiveness are often conditioned by the nature of ties that they have with their global lead firms. Yet, this paper argues, the GVC model fails to recognize agency on the part of local firms in this learning process. Moreover, particular forms of governance arrangements within GVC ties can restrict the prospects for local producers to enhance capabilities and upgrade. Drawing on selected case study evidence from the Indonesian garments and electronics sectors, the paper explores the relationship between distinct types of GVC engagements and firm-level learning and upgrading, and considers how some GVC ties may restrict upgrading.     

Three worlds of global value chains: multiple governance and upgrading paths in the Korean animation industry

Cultural production is increasingly fragmented and dispersed organizationally and geographically as a result of growing offshore outsourcing within and across firms, giving rise to global value chains (GVCs). Yet, a GVC perspective has been applied limitedly to the study of cultural industries without serious consideration of inter-firm governance structure and its consequences on upgrading. Building upon the GVC literature on multiple governance structure, this paper examines three GVCs in Korea with distinctive governance forms: U.S. outsourcing chains, Japanese outsourcing chains, and international coproduction chains. The two outsourcing chains exhibited marked differences in various governance dimensions with distinctive upgrading patterns. International coproduction chains emerged as an alternative pathway of upgrading after the rapid decline of outsourcing exports, posing unique opportunities and challenges to firms and policy-makers. The findings are discussed in the context of multiple governance structure in GVCs and its implications to upgrading in networked global cultural production.     

Introduction: global production networks--debates and challenges

Over the last decade-and-a-half, a rich and vibrant literaturehas evolved that attempts to explain how global industries areorganized and governed, and how, in turn, those relationshipsaffect the development and upgrading opportunities of the variousregions and firms involved. Although this is a sprawling multi-disciplinaryfield of endeavour, to date, three key interlinked strands ofresearch can be distinguished:

• The global commodity chain (GCC)framework, first elaboratedin the volume edited by Gereffiand Korzeniewicz (1994). Initially,stemming from a relativelystructuralist world systems perspective,‘GCC analysisis principally concerned with understandinghow global industriesare organized. It consists of identifyingthe full set of actors(i.e. firms) that are     

Multinational Knowledge Strategies,Policy and the Upgrading Process of Regions: Revisiting the Automotive Industry in Ostrava and Shanghai

This paper revisits how and why new multinational knowledge-based strategies and multi-level governmental policies influence the upgrading process of regions in developing economies. Automotive multinationals traditionally exploited local asset conditions, but it is shown that they have also been contributing to knowledge-generation systems via investments in R&D centres and cooperation with regional knowledge producers. We discern three elements of the upgrading process of regions—upgrading of domestic firms, subsidiary evolution and establishment of strategic relations with local knowledge institutes—to analyse two case studies: Ostrava (Czech Republic) and Shanghai (China). The cases show that all types of upgrading—product, process, chain and functional—have taken place in the last years, and that follow sourcing may have a positive impact on regional upgrading. These observations provide lessons for governments in developing economies which aim to strengthen innovation-based regional development.     

'Globalizing' regional development: a global production networks perspective

Recent literature concerning regional development has placed significant emphasis on local institutional structures and their capacity to 'hold down' the global. Conversely, work on inter-firm networks – such as the global commodity chain approach – has highlighted the significance of the organizational structures of global firms' production systems and their relation to industrial upgrading. In this paper, drawing upon a global production networks perspective, we conceptualize the connections between 'globalizing' processes, as embodied in the production networks of transnational corporations, and regional development in specific territorial formations. We delimit the 'strategic coupling' of the global production networks of firms and regional economies which ultimately drives regional development through the processes of value creation, enhancement and capture. In doing so, we stress the multi-scalarity of the forces and processes underlying regional development, and thus do not privilege one particular geographical scale. By way of illustration, we introduce an example drawn from recent research into global production networks in East Asia and Europe. The example profiles the investments of car manufacturer BMW in Eastern Bavaria, Germany and Rayong, Thailand, and considers their implications for regional development.     

Innovation projects and local production networks: A case study of Hertfordshire

This paper evaluates some of the key arguments underlying what is called here the local production network paradigm (LPNP). These are presented as three interlinked hypotheses that turn on the idea that firms competing in world markets need to accommodate continuous change by fostering product or process innovation. The definition of innovation used in this study is “the commercially successful exploitation of new technologies, ideas or methods through the introduction of new products or processes, or through the improvement of existing ones” (EC DG XIII, 1996, p. 54).

One conventionally described organizational response to this requirement to accommodate continuous innovation is to dis‐integrate firms and set up local production networks. Local production networks are defined in this study as “collaborative linkages between local firms and local factors of production”. Such networks are said to rely on local resources of various kinds to enable them to innovate on a continuous and incremental basis. As a result of such dependencies on local factors, and their interconnectedness with each other, the local production network (LPN) firms then become ‘embedded’ in their localities. Such networked economies have been variously described as new industrial districts, areas of flexible specialization, and innovative milieux.

The evidence presented to test these hypotheses is based on a case study of innovative, award‐winning firms in Hertfordshire. The findings show that although these firms do compete successfully in fast‐moving international markets, they do not rely much on local production networks, as defined here, to enable them to do so. The findings call into question the general applicability of the LPNP. Questions are raised particularly with respect to innovation in the important minority of highly innovative core metropolitan regions.

Innovation is argued to be an interactive process that is both driven by a steady supply of technological advances and stimulated by different types of consumer demand. In the case of the firms interviewed in Hertfordshire, most of their innovative projects were developed by the firms working individually, and in isolation, from other local businesses using high quality, knowledge, information, human resources and venture capital. At the same time, these firms were also pulled by demands from military, health and company consumers. Only in the case of the minority of innovations that were purchased in the first instance by private final consumers were local production networks of some significance.     

Same Sea,Different Ponds: Cross-Sectorial Knowledge Spillovers in the North Sea

Knowledge spillovers are crucial to innovation and upgrading, but it is largely unclear what knowledge spillovers are made of and how they actually happen. The importance of Marshall–Arrow–Romer vs. Jacobs externalities is also a debated matter, whereas the concept of “related variety” has recently come to occupy a middle-ground position. However, the relatedness concept is ambiguous in terms of operationalization and emphasizes codified knowledge on behalf of other knowledge resources that are important for innovation, particularly if firms cross into new sectors. This paper sheds light on the “black box” concepts of knowledge spillovers and relatedness by exploring cross-sectorial transfers from the mature offshore oil and gas sector into the emerging offshore wind industry. A qualitative research design allows for a more nuanced understanding of the contents of knowledge spillovers and (un)relatedness between sectors.     

Technological Learning and Innovation in China in the Context of Globalization

A team of China- and U.S.-based geographers develops the theoretical concept of "learning field" to advance the study of technological innovation through networking under conditions of ongoing globalization. The concept is applied in a survey of ca. 100 firms in the Zhengzhou Economic and Technological Development Zone, located in a relatively underdeveloped region of China. The findings emphasize the different patterns and challenges confronting companies of differing size, property rights, and R&D capacities, as well as the variable extent to which technological learning is based on local versus global linkages and networking. Key elements involved in successful technological upgrading (in addition to networking) are identified, including market structure, competitive strategies, and capital. Also examined are the roles played by geographic, relational, and institutional factors in providing opportunities for learning and cooperation among firms in an industrial district. Journal of Economic Literature, Classification Numbers: D21, D83, O31, P20. 8 figures, 3 tables, 67 references.     

Global Value Chains,Industrial Policy and Economic Upgrading in Ethiopia's Apparel Sector

This article examines whether low-income countries can still benefit from participating in manufacturing global value chains (GVCs) in terms of broader industrial development in a global context of greater competition and higher requirements. It contends that developing internationally competitive local firms and domestic linkages, in addition to upgrading, is crucial for participation in GVCs to drive industrialization. The study focuses on Ethiopia's recent experience with developing an apparel export industry through strategic industrial policy. Based on original empirical data collected through firm-level surveys and interviews with government officials, industry experts and buyers, the article analyses the upgrading and localization trajectories of foreign and local apparel-exporting firms. It argues that value-capture benefits in assembly positions in apparel GVCs have become more difficult. The potential for localization benefits depends on the type of global buyers and foreign producers and their levels of embeddedness, but whether this potential is realized also depends on local firm characteristics and related industrial policy. Ethiopia's industrial policy has been relatively successful regarding national economy linkages, but less successful in developing competitive local export firms due to a weak local manufacturing tradition combined with a global context that has led to a supplier squeeze.     

COMPETING BY DESIGN, SPECIALIZATION AND CUSTOMIZATION: MANUFACTURING LOCKS IN THE WEST MIDLANDS (UK)

The past thirty years have seen major shifts and improvements in manufacturing productivity, bringing greater output but fewer jobs. As a result, manufacturing is now less visible in "post-industrial" societies. Nevertheless, manufacturing still matters in developed market economies but our understanding of manufacturing has failed to evolve with developments in the management and organization of production processes. This paper explores the lock industry in the West Midlands (UK), a traditional low-tech manufacturing sector. West Midlands lock companies that produced standardized, mass-produced products have experienced intensive competition from low-cost producers. Many of these firms have downsized their operations in the UK. Nevertheless, this is only one response to intensified competition. Lock firms located in the West Midlands are unable to compete on price and have shifted away from the production of mass-produced locks to concentrate on high value-added niche markets. The firms have developed inimitability strategies based around design, expertise, specialization, customization and nearness to market that assist them in maintaining their revenue and profit streams. Niche manufacturers have been far less susceptible and relatively immune to foreign competition and they continue to diversify product ranges by targeting specialist end-users. The emphasis is on producing high-quality locks in small batches that can be produced just-in-time to meet customers' requirements. The continued survival of these lock firms is based upon a strategy that includes the development of product-based competitive advantage combined with locational advantage and supported by efficient, responsive and customer-focused manufacturing processes.     

Place‐based policies,firm productivity,and displacement effects: Evidence from Shenzhen,China

Developing and transitional countries devote considerable funds to selected areas to stimulate local growth and firm productivity. We examine the impact of place‐based interventions due to the opening of science parks in Shenzhen, China, on firm productivity and factor use. Our identification strategy, exploiting spatial and temporal differencing in firm‐level data, addresses the issues that (a) the selection of science park locations is not random and (b) high‐productivity firms sort themselves into science parks. Firm productivity is approximately 15–25% higher due to the science park policy. The policy also increases local wages and leads to distortions due to job displacement.     

国外社会升级研究进展及对中国的启示

社会升级研究的兴起源于经济全球化带来的经济升级不能产生相应的社会升级,是对联合国2030可持续发展目标(SDG)之"体面劳动与经济增长"目标的响应.为弥补国内地理学偏重经济升级而忽视社会升级的研究不足,本文系统梳理了国际上社会升级研究的主要进展,对其概念、理论基础和主要研究议题开展了分析.认为当前社会升级研究方兴未艾,...     

Tourism global production networks and uneven social upgrading in Kenya and Uganda

This paper addresses how the growth of tourism global production networks (GPNs) based in Kenya and Uganda created uneven social upgrading outcomes for workers and communities. A tourism GPN and social upgrading framework follows a global political economy approach to analyzing tourism development and labor in diverse tourism geographies. Two tourism GPNs are investigated: Mombasa, Kenya, and Murchison Falls National Park, Uganda. Four main findings emerge: (1) governance relationships between tour operator and accommodation firms directly impacted social upgrading outcomes for hotel workers and indirectly for excursion workers; (2) excursion workers and community members had precarious connections to tourism GPNs; (3) public governance and collective power were key components to social upgrading while supporting its unevenness; and (4) societal embeddedness constructions around gender and regional space influenced worker and community social upgrading potential. Social upgrading is shaped by a confluence of firm, institution, geography, and labor conditions that differentially materializes in specific tourism GPN arrangements.     

The Role of Regional Policies in Promoting Networking and Innovative Activity: Evidence from Small Finnish High-tech Firms

The success of high-technology firms is strongly dependent on their innovation capacity and network relationships. There is a growing recognition that few firms are able to innovate in isolation. Cooperation can provide access to a complementary knowledge base and resources, and speed up the innovation process of firms. Regional developers are criticized for their inadequate ability to integrate themselves into the regional networks and innovation processes of firms and their ability to determine firms' needs for innovation and networking. The research topic of this study concentrates on the possibilities of regional developers of influencing the operational environment of high-tech firms through the development of networks and innovation activity of firms. Of particular interest are the micro-level policies and concrete actions by regional developers for meeting the needs of firms. The data used are based on interviews addressed to high-tech firms located in Jyväskylä Science Park in Finland.     

我国旅游门票研究综述

景区门票是旅游区的"入场券",在以观光旅游为主的中国旅游业中一直占据着重要的地位。我国学术界对景区门票的研究始于20世纪90年代。近年来,随着景区门票的涨价逐渐成为研究的热点。文章通过对该领域相关成果的系统梳理,着重从景区门票的制作、景区门票的价格、景区门票的营销与管理、景区门票的功能等方面对这些成果进行分析和评述。     

权力集中化、生产片断化与全球价值链下本土产业的升级

全球领先企业的权力集中化和生产的片断化导致价值分配的非均衡,并进一步加剧了全球生产网络中权力结构的不对称。本文提出全球价值链上的权力是一种建立在战略资源基础上的不对称的话语权,并归纳了八种基本的市场权力形式。通过对全球十大工业制成品及服务业的市场份额分析,发现技术能力和品牌能力是全球领先企业市场权力集中的主要根源,也是决定全球价值链上价值分配的决定性因素。嵌入全球价值链有利于发展中国家的本土企业迅速提高生产能力、接近全球市场和技术通道,但是从生产能力到创新能力的升级过程并非自动发生;全球价值链生产片断化带来创新过程的垂直分离和重新整合,发展中国家产业升级的关键在于本土企业的吸收能力和学习速度。     

中国科技园区位布局探析--以西安科技园区为例

科技园区是20世纪高技术产业化方面最重要的创举,创建科技园区以发展高技术产业已成为国际趋势。国内外研究表明,科技园区成功的关键的因素之一是区位布局,一般只有大城市的区位条件,才能为高技术企业的技术创新提供各种聚集经济条件。因而科技园区必然在城市化地区首先出现。但国内外科技园区的实践证明,这一结论没有普遍性。本分析了科技园区布局的一般规律,并以西安科技园区位布局为例作分析验证,以期为科技园区的布局提供科学依据。     

Border blocking effects in collaborative firm innovation

Border regions are not often associated with innovation and economic prosperity. And even when they are prosperous, cross-border interaction is still mostly limited. The opening up of borders in Europe has presented new opportunities for firms located in these border regions to co-operate for innovation and knowledge to flow across borders. Despite the reduction of the importance of borders, firms seeking to access cross-border knowledge resources need still to ‘cross’ the border and address the various effects it brings. This paper therefore asks the question of how the presence of a border affects the processes by which firms attempt to build up productive co-operations for innovation. We use a heuristic of collaborative innovation across borders as building up through four sequential cooperation stages, and each of these different stages is susceptible to different kinds of border effects. Using a case study of firms co-operating across the Dutch-Flemish border, we empirically explore these border crossing processes in order to shed further light on how border processes play out.     

The Big Buddha of Hong Kong: an accidental Buddhist theme park

ABSTRACT

The Tian Tan Buddha is the core of a tourism site on Lantau Island, Hong Kong, around which a cable car ride, the Po-Lin monastery and its museum, and the village of Ngong Ping have come to comprise an eclectic set of tourism nuclei that ‘accidentally’ became the ‘Buddhist theme park’ of Hong Kong due to the spatial juxtaposition in an isolated site of these disconnected and even dissonant components built at different times by different jurisdictions. The first objective of this article is to explore the developmental process of a religious site into a theme park of sort through a lengthy process filled with contestation and manipulations. The history-dependent and erratic nature of this process validates the notion of ‘accidental’ theme park used here. It is shown that over time, the Big Buddha went from being a Buddhism-themed leisure site to being generally perceived and promoted as essentially a theme park through a process of partial Disneyization. The second objective is to examine how the ‘theme park’ is perceived by its visitors, more precisely how they see it after their visit and what first-time visitors expect from it beforehand. The first enquiry, performed through the analysis of TripAdvisor reviews, indicates that ex-post, the visitors typically describe having experienced a visit to a theme park. The second enquiry, performed by interviewing first-time visitors about to access the site, suggests that while many first-time visitors expect to visit a theme park as well, others, mainly Western tourists, are expecting a more cultural experience. The findings of the two inquiries are compared to each other and to the image of the site promoted by the local tourism authorities. The subdued political message of the Big Buddha and the degree to which it is discerned by visitors are also discussed.     

The Economic Geographies of the Outer City: Industrial Dynamics and Imaginary Spaces of Location in Copenhagen

The paper focuses on the changing economic geographies of the outer city of Copenhagen. The outer city is not a well-defined place but can be understood as a set of processes transforming the urban economic landscape outside the built-up area. Several central and interrelated economic processes transform the outer city. The paper examines the changing industrial dynamics and location spaces within the framework of geographical proximity and relation propinquity in order to examine the social and cultural embeddedness of location. Imaginary spaces of location are the social constructs of the firm (of the interviewee representing the firm). They are representations of the perception, experience and interpretation of the location of the firm. The imaginary spaces of firms in the outer city are different from those of the firms in the built-up area, and a survey points to the fact that multiple rationalities are important in order to understand industrial location.