Risks and Opportunities of Participation in Global Value Chains

Abstract

Risk is inherent to the pursuit of opportunity. This paper draws on the recent literature and looks at the risks and opportunities firms and their workers face in the global value chains. First, it examines the sharing mechanisms that firms provide from the national and global perspectives; second, it takes a closer look at the new opportunities and challenges for firms and individuals in the global arena; third, it discusses the role of economic upgrading and social upgrading; and finally it sheds light on how the government can help people manage risks and reap the benefits of participation in global value chains.JEL classification: F63, F68, L22, L23

Sectoral Impacts of the Activity Standstill due to External Shocks such as COV ID-19: An Approach Based on the Hypothetical Extraction Applied to the External Insertion of the Spanish Economy

“…Although there are many opportunities for economic progress, participating in GVC is not exempt from risk: the high international competitiveness faced by companies, the need to make significant investments in order to participate in them, as well as labour and environmental problems arising from integration in the GVC -especially in developing countries-are just some of the issues that can be addressed. Several studies have analysed the risks derived from participating in GVCs, generally known as downgrading, which point out issues mainly related to the closure of some companies or the worsening of labour conditions as a vehicle for reducing costs and improving competitiveness through price reduction (Bernhardt, 2013;Chena & Noguera, 2020;Gereffi & Luo, 2014;Godfrey, 2015;Pegler, 2015;Selva & Medina, 2018).…”

Dairy Value Chain Upgrading in Bishoftu Town, East Shewa, Oromia, Ethiopia

“…Value chain: is the sequence of activities required to make a product or provide a service. Value chain included actors like; producers (farmers), collectors, traders (retailers, supermarkets, cafés and restaurants), processors and consumers (Gereffi and Luo, 2014). Value chain is a high-level model developed by Porter (1990) used to describe the process by which businesses receive raw materials, add value to the raw materials through various processes to create a finished product, and then sell that end product to customers.…”

New economic globalization, new industrial policy and late development in the 21st century: A critical analytical review

“…How all the above relates more precisely to industrial (and social) policy is not totally clear. On the one hand, Gereffi and Luo (, p. 4) suggest that new realities of GVCs may lead to “hybrid arrangements that include both neo‐liberal and developmentalist precepts.” On the other, they seem to warn against specific government interventions because “policy makers do not know enough about the intricacies of global industries to spur forms of innovation in GVCs.” Therefore, they present a standard set of facilitating policies in relation to human capital, information about global markets and global match‐making (Gereffi & Luo , p. 20).…”