Global value chains in developing countries: a relational perspective from coffee and garments

Laura Boudreau, Julia Cajal-Grossi and Rocco Macchiavello

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: There is a consensus that global value chains have aided developing countries' growth. This essay highlights the governance complexities arising from participating in such chains, drawing from lessons we have learned conducting research in the coffee and garment supply chains. Market power of international buyers can lead to inefficiently low wages, prices, quality standards, and poor working conditions. At the same time, some degree of market power might be needed to sustain long-term supply relationships that are beneficial in a world with incomplete contracts. We discuss how buyers' market power and long-term supply relationships interact and how these relationships at the export-gate could be leveraged to enhance sustainability in the domestic part of the chains. We hope that the lessons learned by combining detailed data and contextual knowledge in two specific chains—coffee and garments—have broader applicability to other global value chains.

JEL-codes: F14 F23 J81 L14 L66 L67 O14 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2023-08-01
New Economics Papers: this item is included in nep-agr and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published in Journal of Economic Perspectives, 1, August, 2023, 37(3), pp. 59 - 86. ISSN: 0895-3309

Downloads: (external link)
http://eprints.lse.ac.uk/120184/ Open access version. (application/pdf)

Related works:
Journal Article: Global Value Chains in Developing Countries: A Relational Perspective from Coffee and Garments (2023)
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:ehl:lserod:120184

Access Statistics for this paper

More papers in LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library LSE Library Portugal Street London, WC2A 2HD, U.K.. Contact information at EDIRC.
Bibliographic data for series maintained by LSERO Manager ().