Upgrading in global value-chains: a case study of technology-learning among IKEA-suppliers in China and Southeast Asia

Authors: Ivarsson, Inge; Alvstam, Claes Gran

Source: Journal of Economic Geography, Volume 11, Number 4, 28 July 2011 , pp. 731-752(22)

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Abstract:

This article analyses technology upgrading in global value-chains, by using unique data from the Swedish-based home-furnishing retailer IKEA and 23 of its suppliers in China and Southeast Asia. We show how these suppliers use IKEAs technological support to improve their operational and duplicative capabilities, and, more importantly, their adaptive and innovative capabilities. Theoretically, this suggests that typologies of governance structures need to include a developmental category, where buyer-driven value-chains are coordinated by powerful retailers with a global sourcing organization designed to facilitate close, local and long-term interaction, resulting in an efficient sourcing of low-cost, finished products, as well as technological upgrading among suppliers.

Keywords: buyer-driven value-chains; IKEA; technological support; supplier upgrading; China; Southeast Asia; O33

Document Type: Research article

DOI: http://dx.doi.org/10.1093/jeg/lbq009

Publication date: 2011-07-28

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The aims of the Journal of Economic Geography are to redefine and reinvigorate the intersection between economics and geography, and to provide a world-class journal in the field. The journal is steered by a distinguished team of Editors and an Editorial Board, drawn equally from the two disciplines. It publishes original academic research and discussion of the highest scholarly standard in the field of 'economic geography' broadly defined. Submitted papers are refereed, and are evaluated on the basis of their creativity, quality of scholarship, and contribution to advancing understanding of the geographic nature of economic systems and global economic change.