Exploring the relationship between upgrading and capturing profits from GVC participation for disadvantaged suppliers in developing countries. (2nd November 2017)

• Record Type: Journal Article
• Authors: Choksy, Umair Shafi; Sinkovics, Noemi; Sinkovics, Rudolf R.
• Other Names: Ghauri Pervez N. guestEditor.; Park Byung Il guestEditor.
• Is Part Of: Revue canadienne des sciences de l'administration. Volume 34:Number 4(2017:Dec.)
• Page Start: 356
• Page End: 386
• Publication Date: 2017-11-02
• Subjects: upgrading -- functional upgrading -- position -- global value chains -- profit margins; modernisation -- modernisation fonctionnelle -- position -- chaînes de valeur mondiales -- marges de profit; Management -- Periodicals; Management -- Canada -- Periodicals; 658.005
• DOI: 10.1002/cjas.1455
• Languages: English
• ISSNs: 0825-0383

Abstract

Abstract: The existing literature on global value chains (GVCs) suggests that functional upgrading is a key determinant of whether suppliers are able to capture higher profits in GVCs. However, it is unclear whether the same argument holds for disadvantaged suppliers who face high barriers to achieving functional upgrading. Through a review of existing empirical studies, the present paper aims to explore how disadvantaged suppliers in developing countries increase their profits in the face of barriers to functional upgrading. The findings from the literature analysis suggest that the ability of disadvantaged suppliers to benefit from GVC participation depends on the extent of their managerial agency and their ability to leverage multiple upgrading/downgrading trajectories (whether product, process, or functional) and transform them into profitable outcomes. Copyright © 2017 ASAC. Published by John Wiley & Sons, Ltd.