Abstract
International trade today is characterized by the geographical fragmentation and complex dispersion of production processes globally. Extant research on the governance of global value chains (GVCs) focuses on the role of firms, especially leading multinational corporations (MNCs), as well as national governments in shaping the processes, policies, and coordination within production networks. However, in a rapidly digitized global economy, characterized by the catchphrase “Industry 4.0”, GVCs are becoming increasingly transparent and decentralized, given digital accounting and the high data visibility on production processes, with both MNCs and national governments no longer possessing a monopoly over information. This paper thus examines GVCs in the digital era, where the advent of blockchain technology augurs a fundamental shift on how transnational production processes are conducted and reported, and how supply chains are coordinated. In particular, how and under what conditions would blockchain technology shape GVC processes, coordination and governance? What are the resulting challenges of applying blockchain technology to GVCs? I argue that blockchain technology greatly enhances the transparency, traceability, accountability and coordination of production processes within GVCs, and also helps to shape socially responsible business policies, albeit national governments and lead firms remain vital stakeholders. This paper uses two current case studies – the IBM Food Trust and the De Beers diamond blockchain programs – to support my argument. Overall, this paper contributes to the international political economy literature by considering the digitization of international trade, and the impact of disruptive technologies such as blockchains on the conduct, coordination, and governance of GVCs.
Presenters
Zhengqi PanSenior Lecturer, Business, Singapore University of Social Sciences, Singapore
Details
Presentation Type
Paper Presentation in a Themed Session
Theme
KEYWORDS
Global Value Chains, International Political Economy, Blockchain, Industry 4.0, Globalization
