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Exploiting the Modularity of Value Chains: Inter-firm Dynamics of the Taiwanese Notebook PC Industry

Author

Listed:
  • Kawakami, Momoko

Abstract

This paper explores the inter-firm dynamics that govern the rise of capabilities of latecomer firms operating in global value chains. By extending and modifying the model proposed by Gereffi, Humphrey and Sturgeon [2005], I present a framework in which the rise of supplier capabilities is determined by interactions among the strategies of the firms. Based on a case study of the Taiwanese notebook PC industry, the paper will explore how the interactions among outsourcing strategies by lead firms from the developed countries, the learning strategies of Taiwanese suppliers, and the product strategy of powerful component vendors have driven the explosive growth of the industry after the 1990s. By so doing, the paper attempts to highlight the active roles firms play in determining the speed and direction of the rise in supplier capabilities.

Suggested Citation

  • Kawakami, Momoko, 2008. "Exploiting the Modularity of Value Chains: Inter-firm Dynamics of the Taiwanese Notebook PC Industry," IDE Discussion Papers 146, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper146
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    References listed on IDEAS

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    1. Sturgeon, Timothy J., 1997. "Turnkey Production Networks: A New American Model of Industrial Organization?," UCAIS Berkeley Roundtable on the International Economy, Working Paper Series qt2095c9d0, UCAIS Berkeley Roundtable on the International Economy, UC Berkeley.
    2. Kawakami, Momoko, "undated". "Development of the Small- and Medium-Sized Manufacturers in Taiwan's PC Industry," Discussion Papers 256176, Chung-Hua Institution for Economic Research.
    3. John Humphrey & Hubert Schmitz, 2004. "Chain governance and upgrading: taking stock," Chapters, in: Hubert Schmitz (ed.), Local Enterprises in the Global Economy, chapter 13, Edward Elgar Publishing.
    4. Chikashi Kishimoto, 2004. "Clustering and upgrading in global value chains: the Taiwanese personal computer industry," Chapters, in: Hubert Schmitz (ed.), Local Enterprises in the Global Economy, chapter 9, Edward Elgar Publishing.
    5. John Humphrey & Hubert Schmitz, 2004. "Governance in global value chains," Chapters, in: Hubert Schmitz (ed.), Local Enterprises in the Global Economy, chapter 4, Edward Elgar Publishing.
    6. Imai, Ken'ichi & Shiu, Jingming, 2007. "A Divergent Path of Industrial Upgrading: Emergence and Evolution of the Mobile Handset Industry in China," IDE Discussion Papers 125, Institute of Developing Economies, Japan External Trade Organization(JETRO).
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    Cited by:

    1. Wei He, 2016. "A Dynamic Evolutionary Game Model of Modular Production Network," Discrete Dynamics in Nature and Society, John Wiley & Sons, vol. 2016(1).

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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment

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