A Dynamic Model of Global Value Chains: Degree of Monopsony Power, Consolidation and Symbiosis

UWE Bristol

Room 2X242, Business School Building, Frenchay Campus
7 Dec 2017 4 p.m. – 5:30 p.m.

Georgos Galanis

This paper presents a novel understanding of the changing dynamics between supplier and producer driven Global Value Chains (GVC). Motivated by the global garment sector, we develop a dynamic model which captures the interaction between bargaining power and distribution of value among lead and supply firms in the GVC.

We find that the interplay between these two forces, in combination with their spatial specificities are sufficient to make a GVC oscillate between buyer and supplier driven characteristics.

We show that if we incorporate the different effects of consolidation, the GVC moves towards an intermediate case within the buyer/ supplier spectrum.