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Regional productive networks
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Productive networks
• Global commodity chain (GCC)(developed primarily for the analysis ofindustrial commodities in the worldsystems tradition)
• Filière tradition (applied mostly toagricultural commodities originating fromformer French colonies)
• Global value chain (G C)
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Commodity chains
• !" network of labour and production processeswhose end result is a finished commodity# ($opkinsand %allerstein (&' * &''+))
• Firms as either producers of inputs to others* orusers of inputs from others, -istinction between
producer-driven and buyer-driven GCCs• -uring e.pansionary phases* chains are
e.tended and become more vertically
integrated, /n phases of contraction* fiercercompetition weeds out the weaker firms andincreases concentration* while chains arevertically !dis0integrated#,
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-imensions of GC1• 2he input-output structure• 2he geographical coverage• 2he governance structure• 2he institutional framework
• Conse3uences4Chain hierarchy* higher0skill and higher value0addedsections of the chain1etting up and maintaining production and trade
networksGCCs constitute the organi5ational basis of participationin world trade2he role of regional economies or local businesssystems
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GCCs4 relevant analytical issues• Contractual linkages4 !out0sourcing# of previously integrated
components of 26C activities* contractual subordination ofsuppliers previously linked through !open0market# transactions,• 2he role of social and territorial capital• /n producer-driven GCCs , like the automobile and aircraft
industries* barriers to entry are located in large0scale* high0technology production facilities* involving heavy investmentand scale economies* so that manufacturers are the keyagents,
• Buyer-driven chains (consumer electronics* garments*footwear* toys* and fresh fruit and vegetables) have lowbarriers to entry in production* producers are subordinated tothe key agents controlling design and marketing* specificallythe control of international brand names and retailing* wherebarriers to entry are high and profits concentrated,
• Power involves the ability to out0source lower value0addedactivities and to retain or incorporate those with higher value0added,
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Filière (or chain)
• "ctual commodity flows and agents and activities withinfilière * which is viewed as a physical flow chart ofcommodities and transformations, " product systemincludes enterprises producing and distributing theproduct in 3uestion* services regulating its trade*
marketing and consumption* and vertical and hori5ontalrelations between agents,• Concern4 $ow public institutions (e,g, marketing boards)
create a smooth flow of commodities* and how theyaffect local production systems,
• Product specificity/diversity is a variable independentlyaffecting organi5ational forms,
• Greater historical focus and depth than GCC approach,
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G C4 analysis (&) and mapping• 2angible and intangible value0adding
activities• 7conomic and competitiveness issues 8
social and environmental dimensions (laborregulation issues* workforce development*greening of value chains* and gender,)
• pgrading! the dynamic movement withinthe value chain by e.amining howproducers shift between different stages ofthe chain,
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9pgrading in the apparel value chain
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G C4 analysis (:) and mapping• 2o what e.tent countries are involved in a
vertically fragmented production;2he vertical specialisation share ( 1) 4 the import contentof e.ports, 2he indicator measures the value of imported
inputs in the overall e.ports of a country (the remainderbeing the domestic content of e.ports),! 1&# share 4 the percentage of e.ported goods andservices used as imported inputs to produce othercountries# e.ports,
• For e.ample* the foreign content of 91 e.ports isabout &<= while 91 participation in G Cs risesto almost <>=,
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"verage length of G Cs across all industries
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GlobalD value chain
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2he 6utella global value chain
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2he 6utella global value chain• " famous ha5elnut and cocoa spread produced by Ferrero
/nternational 1" (/taly) where 6utella is in high demand (7urope* 6orth "merica* 1outh "merica and Aceania),
• 6ine factories 4 five are located in 7urope* one in Russia* onein 6orth "merica* two in 1outh "merica and one in "ustralia,
• 1ome inputs are locally supplied* for e.ample the packagingor some of the ingredients* like skimmed milk, Atheringredients are globally supplied4 ha5elnuts come from2urkey* palm oil from Ealaysia* cocoa from 6igeria* sugarmainly from ra5il (but also from 7urope) and the vanilla
flavour from China (the manufacturer of vanillin is a Frenchcompany that also produces in France),
• 6utella is then sold in < countries through sales offices ,