Manufacturing Paradoxes: Foreign Ownership, Governance, and Value Chains in China’s Light Industries
Utilizing Chinese industrial data and detailed transactional trade data, this paper finds two paradoxes. First, the distribution of FDI across value chains in light industries is the opposite of many extant explanations. Second, China’s dominance as an exporter is belied by the weaknesses of its domestic firms within the governance of value chains, with important implications for firm upgrading. By analyzing millions of US Customs Bureau trade transactions, the paradoxes are resolved by examining intermediary contractors in East Asian value chains. Even 30 years after reforms began and in the technologically simplest industries, Chinese firms continue to struggle to break through substantial ‘contractual’ barriers to entry.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Jennifer Bair & Marion Werner, 2011. "The place of disarticulations: global commodity production in La Laguna, Mexico," Environment and Planning A, Pion Ltd, London, vol. 43(5), pages 998-1015, May.
- Wood, Adrian, 1997. "Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom," World Bank Economic Review, World Bank Group, vol. 11(1), pages 33-57, January.
- H. Schmitz & P. Knorringa, 2000. "Learning from Global Buyers," Journal of Development Studies, Taylor & Francis Journals, vol. 37(2), pages 177-205.
- Shahid Yusuf & Kaoru Nabeshima & Dwight H. Perkins, 2005. "Under New Ownership : Privatizing China's State-Owned Enterprises," World Bank Publications, The World Bank, number 7399.
- Henry Wai-chung Yeung, 2009. "Regional Development and the Competitive Dynamics of Global Production Networks: An East Asian Perspective," Regional Studies, Taylor & Francis Journals, vol. 43(3), pages 325-351.
- John Humphrey & Hubert Schmitz, 2002. "How does insertion in global value chains affect upgrading in industrial clusters?," Regional Studies, Taylor & Francis Journals, vol. 36(9), pages 1017-1027.
- John H Dunning, 1995. "Reappraising the Eclectic Paradigm in an Age of Alliance Capitalism," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 26(3), pages 461-491, September.
- Barry Naughton, 2007. "The Chinese Economy: Transitions and Growth," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262640643, December.
- Robert C. Feenstra, 1998.
"Integration of Trade and Disintegration of Production in the Global Economy,"
Journal of Economic Perspectives,
American Economic Association, vol. 12(4), pages 31-50, Fall.
- Robert C. Feenstra, . "Integration Of Trade And Disintegration Of Production In The Global Economy," Department of Economics 98-06, California Davis - Department of Economics.
- Robert Feenstra, 2003. "Integration Of Trade And Disintegration Of Production In The Global Economy," Working Papers 986, University of California, Davis, Department of Economics.
- Timothy J. Sturgeon, 2002. "Modular production networks: a new American model of industrial organization," Industrial and Corporate Change, Oxford University Press, vol. 11(3), pages 451-496, June.
- Saliola, Federica & Zanfei, Antonello, 2009. "Multinational firms, global value chains and the organization of knowledge transfer," Research Policy, Elsevier, vol. 38(2), pages 369-381, March.
- John H Dunning, 1980. "Towards an Eclectic Theory of International Production: Some Empirical Tests," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 11(1), pages 9-31, March.
- Steinfeld, Edward, 2010. "Playing Our Game: Why China's Rise Doesn't Threaten the West," OUP Catalogue, Oxford University Press, number 9780195390650, December.
- Shahid Yusuf & M. Anjum Altaf & Kaoru Nabeshima, 2004. "Global Production Networking and Technological Change in East Asia," World Bank Publications, The World Bank, number 14918.
- Paul Krugman, 1995. "Growing World Trade: Causes and Consequences," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1, 25th A), pages 327-377.
- Gereffi, Gary, 1999. "International trade and industrial upgrading in the apparel commodity chain," Journal of International Economics, Elsevier, vol. 48(1), pages 37-70, June.
- Stacey Frederick & Gary Gereffi, 2011. "Upgrading and restructuring in the global apparel value chain: why China and Asia are outperforming Mexico and Central America," International Journal of Technological Learning, Innovation and Development, Inderscience Enterprises Ltd, vol. 4(1/2/3), pages 67-95.
- Bair, Jennifer & Gereffi, Gary, 2001. "Local Clusters in Global Chains: The Causes and Consequences of Export Dynamism in Torreon's Blue Jeans Industry," World Development, Elsevier, vol. 29(11), pages 1885-1903, November.
- Harrold, P. & Lall, R., 1993. "China: Reform and Development in 1992-93," World Bank - Discussion Papers 215, World Bank.
- Ivarsson, Inge & Alvstam, Claes Göran, 2010. "Supplier Upgrading in the Home-furnishing Value Chain: An Empirical Study of IKEA's Sourcing in China and South East Asia," World Development, Elsevier, vol. 38(11), pages 1575-1587, November.
- Ivarsson, Inge & Alvstam, Claes Goran, 2005. "Technology transfer from TNCs to local suppliers in developing countries: A study of AB Volvo's truck and bus plants in Brazil, China, India, and Mexico," World Development, Elsevier, vol. 33(8), pages 1325-1344, August.
- Steinfeld, Edward S., 2004. "China's Shallow Integration: Networked Production and the New Challenges for Late Industrialization," World Development, Elsevier, vol. 32(11), pages 1971-1987, November.
- Neil M. Coe & Peter Dicken & Martin Hess, 2008. "Global production networks: realizing the potential," Journal of Economic Geography, Oxford University Press, vol. 8(3), pages 271-295, May.
When requesting a correction, please mention this item's handle: RePEc:eee:wdevel:v:57:y:2014:i:c:p:47-62. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamier, Wendy)
If references are entirely missing, you can add them using this form.