Académique Documents
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Dr Karen Lai
Learning objectives:
Understand how production happens on a global scale
Examine transnational corporations (TNCs) as powerful economic
actors
Consider the impacts of our consumption decisions on producers and
environments
Evaluate alternative and ethical forms of consumption
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Outline
1.
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3.
4.
5.
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borders
Organised on a global scale
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a) Intra-firm networks:
Seagates Global Hard Disk Manufacturing
(Source: http://www.seagate.com/sg/en/about/jobs/)
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b) Inter-firm networks
International subcontracting and outsourcing
TNCs such as Apple, Nike do not own any
factories themselves!
Original Equipment Manufacturing (OEM):
specifications set by client companies
E.g. Quanta Computer for Apple and HP, Alienware, Lenovo,
RIM, Fujitsu, Siemens, Sharp, Sony, Toshiba
E.g. Nike 96% of all manufacturers in Vietnam, Cambodia,
China and Indonesia
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Costs:
Limited control over operations
Scandals regarding sweatshop labour, product
quality issues
E.g. Nike in the 1990s, Apple iPhones/iPads recently
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a) Coffee
The coffee commodity chain
(Source: Ponte, 2002)
Largely controlled by
wholesalers (E.g. Olam) and
brands (e.g. Starbucks,
Nestle)
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b) Apparel
Clothing industry largely driven by mass consumption in
department stores, chain stores.
Consumer demand for cheaper and newer products
Ever shorter cycles of fashion consumption
Basic raw materials from primary producers
Very fragmented and large numbers of manufacturers
Small numbers of purchasing companies supplying to
retailers
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(Source: http://www.colorado.edu/ibs/PEC/gadconf/papers/gereffi.html)
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4. Ethical Consumption
Do consumers have a responsibility for the working conditions
and livelihoods of workers in distant places?
Living wage
Sustainable farming practices
Community development (education, health, housing etc.)
Labour practices (health and safety, child labour)
What is Fairtrade?
Pricing
Investing in local communities
Changing power relations within production chains
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5. Conclusion
TNCs as powerful actors in the global economy
The production process as global
Intra-firm and inter-firm networks
But distinctive geographies
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