7. The Globalization of Production

2016 ◽  
Author(s):  
Eric Thun
Keyword(s):  
Foreign Direct Investment ◽  
Value Chain ◽  
Direct Investment ◽  
Two Dimensions ◽  
Global Value Chain

This chapter examines how advances in transportation and technology allow a firm to divide up a global value chain — the sequence of activities that lead to the production of a particular good or service — and how these decisions create new opportunities and challenges for both companies and the societies within which they operate. It first considers the rise of global production and the forces that have led to dramatic increases in foreign direct investment and outsourcing. It then describes two dimensions of a global value chain: governance (how to coordinate activities) and location (where to locate each activity). It also explores trends in the globalization of production by focusing on the case of China.

7. The Globalization of Production

2020 ◽  
pp. 175-196
Author(s):  
Eric Thun
Keyword(s):  
Foreign Direct Investment ◽  
East Asia ◽  
Value Chain ◽  
Direct Investment ◽  
Global Value Chain

This chapter addresses the globalization of production. Although companies have been investing abroad for centuries, the most recent era of globalization has created an unprecedented range of possibilities for global firms to reorganize and relocate their activities. The chapter analyses how advances in transportation and technology allow a firm to divide up a global value chain — the sequence of activities that lead to the production of a particular good or service — and how these decisions create new opportunities and challenges for both companies and the societies within which they operate. It first reviews the rise of global production and the forces that have led to dramatic increases in foreign direct investment (FDI) and outsourcing. The central questions for any firm involved in global production involves how to govern the value chain and where to locate different activities. The chapter then provides a framework for understanding these issues and the implications of the various choices. It also applies these concepts to the case of East Asia, particularly China.

scholarly journals The global value chain dimension of foreign direct investment flows in the agro-industrial sector of South Africa, 2003–2014

2018 ◽  
Vol 18 (1) ◽  
Author(s):  
Henri Bezuidenhout ◽  
Sonja Grater ◽  
Ewert P.J. Kleynhans
Keyword(s):  
South Africa ◽  
Foreign Direct Investment ◽  
South African ◽  
Value Chain ◽  
Direct Investment ◽  
The United States ◽  
Industrial Sector ◽  
Value Chains ◽  
Global Value Chain ◽  
African Countries

Orientation: African countries offer many investment opportunities and also urgently need global investment finance. Along the value chains of the agro-industrial sector there are many global challenges for African countries to attract foreign direct investment. This article investigates the investment flows in agro-industries and products to and from South Africa.Research purpose: This study evaluates the nature and dimensions of the agro-industrial sector that receive investment inflows in South Africa, as well as investigating South African investment patterns into Africa.Motivation for the study: Of particular interest is the relationship between foreign direct investment (FDI) flows, their integration into global value chains and sustainable investment options.Research design, approach and method: Qualitative data and visual techniques using available data for the period 2003–2014 disambiguate the linkages in FDI patterns with regard to regions, industries and specific companies. Flows between regions and the specific companies are identified and studied.Main findings: The results indicate that the United States, the United Kingdom and the Netherlands are the largest investors in South Africa, with a strong focus on agricultural input production and subsequent agro-processing industries. South African investment into Africa follows a similar, albeit narrower and more focused, pattern. The study concludes that foreign multinational enterprises are actively involved in global value chain expansion and South African firms are following suit.Practical/managerial implications: The lack of FDI in actual agricultural crop production in Africa offers future investment opportunities.Contribution/value-add: This study creates a better understanding of how FDI in agriculture is linked to the development of regional value chains in the Southern African region. The methodology applies a novel approach to an important field of study, of which little knowledge exists, and may contribute to the creation of wealth in the countries of the region and the welfare of its population.

Promoting Foreign Direct Investment in the Indo-Pacific Region: Scope and Opportunities

2019 ◽  
Vol 75 (4) ◽  
pp. 490-509
Author(s):  
Durairaj Kumarasamy ◽  
Prabir De
Keyword(s):  
Foreign Direct Investment ◽  
Foreign Investment ◽  
Value Chain ◽  
Direct Investment ◽  
Multinational Firms ◽  
Global Value Chain ◽  
Pacific Region ◽  
International Sourcing ◽  
The World ◽  
Investment Barriers

Indo-Pacific construct has picked up a motivating pace in recent years. Several countries across the world have shown their interest in joining the Indo-Pacific region. Indo-Pacific region has been the world’s leading source and destination of foreign investment. This article analyses the trends in investment, bilateral and multilateral investment engagements and investment barriers and presents a way to promote foreign direct investment (FDI) in the Indo-Pacific region. It also examines India’s investment relations with some of the Indo-Pacific countries. Further, it looks into the inter-linkages between FDI and global value chain, given that multinational firms play a significant role in bringing international sourcing, technology sharing, and production networking across countries.

scholarly journals Impact of Foreign Direct Investment of Indian Economy in Epoch of Global Value Chain with Reference to Industrialists in Tirunelveli District

2019 ◽  
Vol 8 (2S10) ◽  
pp. 635-637
Keyword(s):  
Foreign Direct Investment ◽  
Supply Chain ◽  
Value Chain ◽  
Direct Investment ◽  
Business Environment ◽  
Global Value Chain ◽  
Indian Economy ◽  
Foreign Companies ◽  
The People ◽  
Negative Impacts

A foreign direct investment (FDI) is an investment in the form of controlling ownership in a business in one country by an entity based in another country. It is thus distinguished from a foreign portfolio investment by a notion of direct control. Foreign direct investment (FDI) is an investment made by a firm or individual in one country into business interests located in other country. Generally, Foreign direct investment (FDI) takes place when an investor establishes foreign business operations or acquires foreign business assets, including establishing ownership or controlling interest in a foreign company.Foreign direct investment (FDI) in India is a major monetary source for economic development in India. Foreign companies invest directly in fast growing private Indian businesses to take benefits of cheaper wages and changing business environment of India. Foreign Direct Investment (FDI) gives both positive and negative impacts on Indian economy in epoch of global value chain. The global value chain (GVC) describes the people and activities involved in the production of a good or service and its supply, distribution, and post-sale activities (also known as the supply chain) when activities must be coordinated across geographies. A supply chain is the network of all the individuals, organizations, resources, activities and technology involved in the creation and sale of a product from the delivery of source materials from the supplier to the manufacturer, through to its eventual delivery to the end user. International production, trade and investments are increasingly organized within so-called global value chains (GVCs) where the different stages of the production process are located across different countries. Industrialists are having different thoughts on impacts of Foreign Direct Investment (FDI) on Indian economy.

scholarly journals The impact of Two-way FDI on the upgrading of global value chain of China’s manufacturing industry

2021 ◽  
Vol 251 ◽  
pp. 01077
Author(s):  
Qiannan Zhang ◽  
Yiyin Huang ◽  
Miraj Ahmed Bhuiyan
Keyword(s):  
Foreign Direct Investment ◽  
Value Chain ◽  
Direct Investment ◽  
Manufacturing Industry ◽  
Fixed Effect Model ◽  
Global Value Chain ◽  
Effect Model ◽  
Starting Point ◽  
Leading Industry ◽  
The Impact

Manufacturing industry is the leading industry in China’s national economy. The participation of global value chain (GVC) in China’s manufacturing industry is very high, whereas its GVC status is very low. The inward foreign direct investment (IFDI) and outward foreign direct investment (OFDI) are the main ways for China’s manufacturing industry to integrate into the global value chain. Previous studies mainly focused on the upgrading of GVC in China’s manufacturing industry from the perspective of single IFDI or single OFDI. This paper takes the perspective of “Two-Way FDI” as the starting point. Using the panel data of China’s manufacturing sub-industries, this paper analyzes the mechanism of IFDI, OFDI and two-way FDI influencing GVC. The Fixed Effect Model is established to analyze the impact of IFDI, OFDI and two-way FDI on GVC upgrading of China’s manufacturing industry.

scholarly journals El sector de electrodomésticos de Nuevo León y un análisis teórico de los factores que influyen el desarrollo de proveedores nacionales por parte de las empresas multinacionales

2017 ◽  
Vol 13 (25) ◽  
Author(s):  
Oscar Elí Velarde Moreno ◽  
Mónica Blanco Jiménez ◽  
Sergio Armando Guerra Moya
Keyword(s):  
Foreign Direct Investment ◽  
Value Chain ◽  
Direct Investment ◽  
Statistical Data ◽  
Theoretical Framework ◽  
Government Institutions ◽  
A Value ◽  
Home Appliance ◽  
The Subject ◽  
The Impact

Abstract: The impact of multinational subsidiaries or Foreign Direct Investment in host economies had been subject of debate for years (Hirschman, 1958). Recently the researchers and government institutions in México are being attracted to the subject because of the interest on the impact of foreign multinational subsidiaries that operate as an anchor company of a value chain, and more specifically in the local supplier development.The purpose of this investigation is to analyze the home appliance sector in México and NuevoLeón, presenting the statistical data and a theoretical framework of supplier development in order to set a model for further investigations.Keywords: exportations, foreign direct investment, home appliance, multinationals, supplier development.JEL: F230, F630Resumen: El impacto de las empresas multinacionales o la inversión extranjera directa en los países huéspedes ha sido un sujeto de debate durante años (Hirschman, 1958). Recientemente, las instituciones gubernamentales se han sentido atraídas al tema debido al  interés por saber el impacto de las subsidiarias extranjeras que operan como empresa ancla en las cadenas de valor, y más específicamente desarrollando proveedores nacionales. El propósito de esta investigación será hacer un análisis del sector de electrodomésticos en nuevo Por lo que se presentará primero la evolución estadística del sector de electrodomésticos para luego hacer una revisión teórica de la literatura referente al desarrollo de proveedores con el objetivo de establecer un modelo para investigaciones futuras.Palabras claves: desarrollo de proveedores, electrodomésticos, exportaciones, inversión extranjera directa, multinacionales. 

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