Public and private sources of governance in global production networks : the case of the Asia-Pacific steel industry




Wilson, Jeffrey David

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This study is concerned with the governance of global production networks, and examines the role of public and private actors as competing sources of production network governance. In recent years, the development of a set of global production networks approaches as a subfield within international political economy (IPE) scholarship has increasingly drawn scholarly attention to these qualitatively different and novel systems of production, which have emerged to manage and organise the trade and investment relationships between firms in functionally{u00AD}integrated but globally-distributed industries. While these approaches have provided a set of methodological tools for the analysis of the governance of globalised industries and have spawned numerous empirical studies, questions remain over how these governance processes can be theorised, especially whether production networks can be understood and explained as a set of private, inter-firm relationships to manage the functional integration between dispersed industries; or whether public actors (i.e. the state) can also act as a source of governance, and if so by what means. An impasse on this issue between two competing approaches - the global value chains (GVC) and global production networks (GPN) frameworks - has come to characterise this literature; and led many contributors to call for a 'second generation' of analysis that bridges this gap. This study contributes to these efforts by addressing the question of what respective roles public and private actors perform in production network governance, and what explains these roles. It makes such a contribution in two ways. First, it draws upon broader debates in IPE over the role of public and private actors under conditions of economic globalisation to develop a new framework for production networks analysis, which synthesises theoretical propositions from IPE debates with the empirical concerns of the production networks approaches to derive research questions and explanatory hypotheses concerning the role of public and private actors. Second, it applies and evaluates the explanatory purchase of this 'synthetic' framework in the case of steel production networks in the Asia-Pacific region, which integrate mineral suppliers in Australia, Brazil and Canada with steel producers in Japan, Korea and China. Through an analysis of three temporally-defined case studies on the evolution of governance arrangements in these networks from the 1950s to 2010, it draws two conclusions regarding the sources of production network governance. First, it argues the role of public and private actors can be explained as a result of the possession of 'specific advantages', which have allowed certain actors to exclude the interests of competing actors in determining governance outcomes; and second that actors' possession of such specific advantages are conditioned by institutional features of the firms and states in question. On the basis of these theoretical insights from broader IPE debates, and the empirical findings they help generate in the case of the Asia{u00AD}Pacific steel industry, the study argues that this proposed framework serves as a useful via media to navigate the current impasse between competing approaches to production networks analysis and to theorise the role of public and private actors in production network governance.






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