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PLUSES AND MINUSES OF BEING IN A GLOBAL VALUE CHAIN – THE CASE OF ROMANIAN APPAREL SMEs

Author

Listed:
  • ALINA FLORENTINA AVRIGEANU

    (Romanian – American University, Romania)

  • FLAVIA GABRIELA ANGHEL

    (Romanian – American University, Romania)

  • ELENA RADU

    (Romanian – American University, Romania)

Abstract

In order to survive in the face of continuing global competition, in the long run, developing countries SMEs will have to be inserted into global value chains (GVCs). For the Romanian apparel SMEs, the insertion in a GVC is having farreaching effects on competitiveness, cross-national transfer of new technology, innovation, skills, knowledge and learning, and potentially offers greater opportunities for reaching welfare gains. But it also brings the challenge of being locked into a race to the bottom, “the low road” of competitiveness, based on cutting wages, disregarding labour and environment regulations and avoiding taxation. In this paper we examine the pluses and the minuses of being in the GVC for the Romanian apparel SMEs in order to point up several strategies needed for the “high road” of competitiveness, based on the use of new technologies, efficiency in production and trade, diversified products of better quality. Thus SMEs from the Romanian apparel industry will be able to support higher wages and enhance the national income.

Suggested Citation

  • Alina Florentina Avrigeanu & Flavia Gabriela Anghel & Elena Radu, 2010. "PLUSES AND MINUSES OF BEING IN A GLOBAL VALUE CHAIN – THE CASE OF ROMANIAN APPAREL SMEs," JOURNAL STUDIA UNIVERSITATIS BABES-BOLYAI NEGOTIA, Babes-Bolyai University, Faculty of Business.
    • Handle: RePEc:bbn:journl:2010_1_10_avrigeanu
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    References listed on IDEAS

    as
    1. Giuliani, Elisa & Pietrobelli, Carlo & Rabellotti, Roberta, 2005. "Upgrading in Global Value Chains: Lessons from Latin American Clusters," World Development, Elsevier, vol. 33(4), pages 549-573, April.
    2. Denis Eylem Yoruk, 2001. "Patterns of Industrial Upgrading in the Clothing Industry in Poland and Romania," UCL SSEES Economics and Business working paper series 19, UCL School of Slavonic and East European Studies (SSEES).
    3. Carlo Pietrobelli & Federica Saliola, 2007. "Power Relationships along the Value Chain: Multinational Firms, Global Buyers, and Local Suppliers' Performance," Working Papers 0702, CREI Università degli Studi Roma Tre, revised Jan 2007.
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    Keywords

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    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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