global commodity chains

Question 1

example of value

Answer 1

silver, diamonds

Question 2

power d

Answer 2

ability to make somebody do something they wouldn’t otherwise do

Question 3

what are some value adding activities at firm level (value chains)

Answer 3

inbound and outbound logistics,
production,
marketing and sales,
services and maintenance

Question 4

what are some value subtracting activities at firm level (value chains)

Answer 4

firm infrastructure (admin, accounting, legal),
technology development,
human resources management,
procurement

Question 5

firms want to ______ value subtracting activities and ______ value adding

Answer 5

minimise,

maximise

Question 6

how are global value chains topdown

Answer 6

focus on lead firms and inter-firm networks

Question 7

how are global value chains bottom up

Answer 7

focus on countries and regions, which are analysed in terms of various trajectories of economic and social upgrading or downgrading

Question 8

talk about buyer driven commodity chains

Answer 8

retailers and brands are power holders, finance and strategy - centralised; design, branding, marketing - brought in; production, logistics - outsourced

Question 9

in buyer driven commodity chains what is centralised

Answer 9

finance and strategy

Question 10

talk about producer driven commodity chains

Answer 10

technology and capital intensive industries are power holders (automotive, semi-conductor, electronics), operate through networks of subsidiary, suppliers and retailers

Question 11

what are the main assumptions of global value chains

Answer 11

political economy and institutions matter,

upgrading is possible - economies can move from low to high value sectors, global inequality shifts around

Question 12

what are two differences between gpns and gccs/gvcs

Answer 12

gccs/gvcs are linear structures, gpns incorporate different network configurations,
gccs/gvcs focus on governance of inter-firm transactions, gpns encompass different sets of actors and relationship

Question 13

what do global production networks focus on production as

Answer 13

social processes of material reproduction, value production more than an exchange of like for like commodities

Question 14

in global production networks is labour simply a commodity to be exchanged

Answer 14

no, labour produces value so is not simply a commodity to be exchanged

Question 15

what do global production networks focus on vaue chains as

Answer 15

means of value creation for all parties involved

Question 16

how do global production networks view processes

Answer 16

processes are inevitable - markets are natural, everything else is a barrier to markets, therefore to wealth of whole society

Question 17

what does an economics centred perspective ignore

Answer 17

the social and political dimensions of production, value is produced socially, wealth transfer is from labour to capital

Question 18

what do gpns do to firms

Answer 18

they integrate firms into structures which blur traditional organisational boundaries

Question 19

what do gpns do to places

Answer 19

GPNs also integrate places in ways that have enormous implications for their economic development

Question 20

intra-firm relationships d

Answer 20

between different parts of a corporate network, as each part strives to maintain or to enhance its position

Question 21

inter-firm relationships d

Answer 21

between firms belonging to separate, but overlapping, networks as part of customer-supplier transactions and other inter-firm interactions

Question 22

firm-place relationships d

Answer 22

as firms attempt to extract the maximum benefits from the communities in which they are embedded and as communities attempt to derive the maximum benefits from the firms’ local operations

Question 23

place-place relationships d

Answer 23

between places, as each community attempts to capture and retain the investments (and especially jobs) of the component parts of GPNs

Question 24

where on the value chains of production is the highest value capture usually found

Answer 24

tends to be at the high end of the value chain (design, brand, ownership and control) while assembly is far less significant in the total value added

Question 25

what eventually happens to any capital inflow because of a tnc setting up in a local area

Answer 25

there will eventually be a reverse flow as the local operations remits earnings and profits back to its parent company

Question 26

what are some possible benefits related to stimulating local firms by involvement in a GPN

Answer 26

placing orders with local suppliers leads to raised technical expertise,
experience gained in new technologies enables them to compete more effectively,
expanded activities of suppling firms and of ancillary firms involved in transportation and distribution results in creation of additional employment

Question 27

what does the actual incidence of local linkage formation by foreign-controlled plants depend on

Answer 27

the particular strategy followed by the TNC and the role played by the local operation in that strategy,
characteristics of the local economy,
time (supply capabilities do not develop over night)

Question 28

what is the critical factor that determines whether knowledge is diffused by the GPN locally

Answer 28

the extent to which the technology is made available to potential users outside the firm either directly, through linkages with indigenous firms, or indirectly via ‘demonstration effects’

Question 29

the very nature of the tnc ______ the spread of its proprietary technologies beyond its own organisational boundaries

Answer 29

inhibits

Question 30

what is the evidence of transferring technologies for the electronics industry in Malaysia

Answer 30

TNC participation has produced latent technological capabilities for absorption by local firms and have transformed the local environment to facilitate export manufacturing in these countries involving a high tech industry

Question 31

what does the number of direct jobs created by the gpn depend on

Answer 31

the scale of its activities,

the technological nature of the operation, particularly on whether it is capital intensive or labour intensive

Question 32

what does the number of indirect jobs created by the gpn depend on

Answer 32

the extent of local linkages forged with local firms,
the amount of income generated by the TNC and retained within the local economy (in particular the wages and salaries of employees and of those in linked firms will, if spent on locally produced goods and services, increase employment elsewhere in the domestic economy)

Question 33

what else do you need to consider when thinking about jobs created by GPNs in local economies

Answer 33

quality of jobs (is there opportunities for advancement),
wages and salaries,
labour relations and working conditions

Question 34

example of where new recruits have to do complex tasks as oppose to just ‘back office’ tasks * (will be great to have example in essay)

Answer 34

JP Morgan make new recruits settle complex structured-finance and derivative deals

Question 35

what are the three aspects of environmental damage that are especially important

Answer 35

overuse of non-renewable and renewable resources (exploitation of fossil fuels),
overburdening of natural environmental sinks (increasing concentration of greenhouse gases),
destruction of increasing numbers of ecosystems to create space for urban and industrial development