Peter Knorringa

Learning from Global Buyers

An increasing number of developing countries engage in contract manufacturing for a decreasing number of global buyers. This constellation characterises many labour intensive export sectors. The positioning of developing country enterprises in such buyer-driven chains is central to research concerned with identifying the winners and losers from globalisation. This study contributes to this debate by seeking answers to two questions: First, what can researchers learn from global buyers about the relative strengths and weaknesses of developing country producers; second, what can these producers learn from global buyers and what circumstances facilitate or constrain such learning.

Agra: An Old Cluster Facing the New Competition

Abstract This paper examines how producers in a traditional Indian cluster have responded to major recent changes in internal and external markets. It shows that in a heterogeneous cluster such as Agra the answer differs by market channel. In Agra, the challenges of the 1990s have altered both the cluster composition and the extent of cooperation in interfirm relationships. The paper investigates how specific groups of producers in particular market channels have prospered while many other producers have closed down or face ever more desperate conditions in the market channel of last resort.

Constrained Gazelles: High Potentials in West Africa’s Informal Economy

The informal sector is typically characterized as being very heterogeneous and possibly composed of two clearly distinct segments, sometimes called the lower and upper tiers. However, empirical evidence shows that even among lower tier entrepreneurs profitability can be quite high. We combine these findings and develop an innovative approach to identify what we call “constrained gazelles”, next to the well-known survivalists in the lower tier and growth-oriented top-performers in the upper tier. Our sample of informal entrepreneurs in seven West-African countries allows to link the relative size of these three groups to the structural and macroeconomic environment in these countries.

Unpacking social capital in Economic Development: How social relations matter

Abstract Social capital is a contested concept, embraced by the mainstream as “the missing link” in economic analysis. This article suggests a way to turn it into a more meaningful understanding of how social relations matter in the economy. It will do so by unpacking the concept into various elements, distinguishing what social relations are from what they do, and by recognizing power in social relationships. We will illustrate our alternative approach with two case studies on the Small and Medium scale Enterprises (SME) footwear sector in Ethiopia and Vietnam. We conclude with suggestions on how this more contextual approach to the understanding of the economic influences of social relations may contribute to social economics.

Beyond social capital : a critical approach

Introduction Sierk Horn and Adam R. Cross 1. The Rise of the Japanese Multinational Enterprise: Then and Now Peter J. Buckley Part 1: Japanese Investment Strategies for China 2. Competition Strategies of Japanese Manufacturing Firms in China mid-1990s and 2000s Tetsuo Abo 3. Spatial Determinants and Characteristics of Japanese FDI in China John Cassidy 4. The Evolution of Japanese Investment in China: From Toys to Textiles to BPO Andrew Delios 5. Cross-Border Development of Equipment Manufacturing Industries in Asia Markus Thinnes Part 2: Competitive and Localisation Strategies of Japanese MNEs 6. Cooperation or Competition in the Electronics Industry in China - Segmentation and Concentration Strategy with regard to R&D and Human Resources Development Sung-Jo Park 7. Pre-clusterization in Emerging Markets: The Toyota Groups Entry Process in China Faith Hatani 8. The Competitive Edge and Localisation Dilemma faced by Japanese Companies in China Hiroshi Itagaki Part 3: Japanese Management Practices in China 9. Multidomestic Industries from Japan and the Transfer of Organisational Practices to Chinese Subsidiaries Jos Gamble 10. Leapfrogging the Wheel of Retail: Japanese Retailing Strategies in China Sierk Horn and Katrin Horn 11. A Comparative Study of Product Development and Marketing in China and Japan Tomoo Marukawa Part 4: Japanese MNEs and Regional Integration in East and SE Asia 12. Intermodal Logistics Developments in North-East Asia - Challenges and Directions Burkhard Horn and Sam Dzever 13. Global Operations Management of Japanese companies in the Asian Region Masahiro Miyagawa 14. The Transformation of Japan Post into a Global Player Tim Goydke

New Middle-Class Consumers in Rising Powers: Responsible Consumption and Private Standards

In this paper, we explore how the unprecedented expansion of new middle-class consumers in Rising Powers is likely to influence the extent and meaning of responsible consumption through private standards. We find that these middle-class consumers are likely to engage in discretionary spending, even at relatively low levels of income. Unfortunately, existing research does not allow us to predict the extent to which this discretionary spending will be used for responsible consumption. We develop a simple matrix to explore where and when private standards are more likely to stimulate responsible consumption effectively, and we put forward some hypotheses for future research.

Artisan labour in the Agra footwear industry: Continued informality and changing threats:

Informal artisanal employment conditions effectively pass on overall instability in the Agra footwear industry to the Jatav community. Although in recent decades both mar ket channels and the production structure have become more complex, Jatav artisans are incorporated in basically two ways. Since the 1980s, artisans either run or work in home-based units that manufacture cheap footwear for local upper-caste merchants, or they work as hired labourers in larger workshops and small-scale factories. Arti sanal employment in the 1990s is decreasing because of the increased availability of plastic footwear, the collapse of some export markets and the caste-based antagonism between the dominant Punjabi trader-entrepreneurs and Jatav artisans. This has resulted in an increasingly overcrowded home-based sector of last resort, and more precarious employment conditions. Only a small group of artisans, who are employed in small-scale export-oriented factories run by non-Agra entrepreneurs, enjoy relatively better employment conditions.

Shifting regional dynamics of global value chains: Implications for economic and social upgrading in African horticulture

Global value chain and global production network analyses have largely focused on dominance of Northern retailers over suppliers in the global South. The expansion of retailers within the global South sourcing from and supplying consumer end-markets within their own geographic regions is reconfiguring value chain dynamics. This paper draws on GVC and GPN approaches and the concepts of multi-polar governance to analyse changing dynamics of global and regional retail supply networks. Drawing on a case study of supermarket expansion within South and East Africa, it analyses how ‘waves of diffusion’ by global and regional supermarkets provide new opportunities for ‘strategic diversification’ by some horticultural producers and workers. It examines the implications for economic and social upgrading and downgrading, finding mixed outcomes. Strategic diversification provides opportunities for economic and social upgrading by more capable suppliers and skilled workers, but economic downgrading pressures persist and some are excluded from both global and regional value chains.

New end markets, supermarket expansion and shifting social standards

In recent years, Northern supermarket chains have internationalized rapidly and Southern supermarket chains have expanded their footprint in emerging markets. As they have done so, questions have arisen about the impact of such supermarkets and the extent of consumer demand for social standards (labour standards and fair trade). While standards have been more (or less) codified in their Northern counterparts over recent decades, it remains an empirical question whether – and if so how – they will take hold in the rapidly expanding markets of the global South. The paper analyses the extent to which social standards are applied by Northern lead firms as well as regional supermarkets operating in the global South. It questions the view that Southern consumers and civil society actors are uninterested in social standards and suggests a more differentiated and complex process driving their selective application in the global South. Value chain concepts of governance help analyse how lead firms are shifting from regimes of control and coordination towards practices of normalization and convergence. We draw on the notion of multi-polar governance to explore emerging pressures for social standards extended to Southern consumer markets and differential channels for convergence emerging across the global North and South. Three case studies highlight diverse channels of convergence on social standards: (i) led by transnational retailers, (ii) led by standards initiatives and (iii) linking private with public governance. These illustrate that socially responsible consumption is only one element in more complex multi-polar governance processes that reveal trends towards both divergence and convergence in the drivers of social standards within emerging economies.

Frugal Innovation in Africa: Tracking Unilever's Washing-powder Sachets

Western-based multinational enterprises (MNEs) have played a major role in the introduction and marketing of new products and services in Africa?s consumer markets. Frugal innovations are the result of the recent ambitions of mostly MNEs to design and sell products for and to consumers at the Bottom of the Pyramid (BoP). This chapter presents a case study which suggests that better collaboration with African partners in order to supply goods to the BoP in a profitable way is of great importance. The OMO sachets were a success from a sales perspective and turnover increased greatly over figures from the early 1990s due to the introduction of the more affordable economy-sized sachets. Finally, the chapter considers whether, by addressing frugal innovation for Africa, product innovations brought into Africa by foreign parties can increasingly become influenced and transformed a priori by Africans, before the products have entered the African market. Keywords: Africa; Bottom of the Pyramid (BoP); frugal innovation; OMO sachets; Western-based multinational enterprises (MNEs)