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

Yohanes Kadarusman and Khalid Nadvi

European Planning Studies, 2013, vol. 21, issue 7, 1007-1028

Abstract: 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.

Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
http://hdl.handle.net/10.1080/09654313.2013.733850 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:eurpls:v:21:y:2013:i:7:p:1007-1028

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CEPS20

DOI: 10.1080/09654313.2013.733850

Access Statistics for this article

European Planning Studies is currently edited by Philip Cooke and Louis Albrechts

More articles in European Planning Studies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().