Global Production Network

Guiding Questions & Answers (to be answered):
1. What is the Global Production Network (GPN)?
2. What enables the creation or plugging in of a GPN?
3. Who are the stakeholders involved in a GPN?
4. What factors affect changes in a GPN?
5. What has Singapore government done to facilitate plugging of Singapore into a GPN?
6. What significance is the GPN to development?
7*. Describe links between a GPN in terms of resource utilization and appraisal.

Summary of Geography Digest on the Global Production Network:
The GPN is an analytical framework which examines the roles of various actors in the establishment of technological and contractual linkages with global brand name product/service providersand integration into the global economy (plug-in to the GPN), thus revealing the uneven distribution of value capture and retention between countries of production and consumption.

The GPN focuses on the role of actors in the establishment of 'strategic coupling' between lead firms and their strategic suppliers in order to reveal the shifting realities of globalisation and uneven distribution of value between countries of production and consumption. Actors include firm and non-firm actors (such as states, civil society, labour markets and consumers), and the examination of strategic coupling including the governance of contractual relationships and technological linkages between various firm and non-firm actors.

In the past, 'country of origin' could be used to determine location of value capture and retention in the world. However, with the improvements in technology, transport and communications, it is now difficult to determine value capture and retention in the production and consumption countries/economies. Therefore, GPN was developed as a perspective that analyses the geography of value capture and retention with the realities of globalization.

Local Firms & GPNs
The ability of local firms to plug themselves into the GPN is dependent on both their own internal capability and external relationships/interaction. Internal capabilities is determined by factors like their ability to manage and utilize resources, and the corresponding supporting institutional environment, including government policies. External interaction is determined by whether local firms are compatible with lead firms and suppliers, and their offered value to these firms and suppliers.

Their level of engagement with other actors in the GPN would then determine their level of development as a firm, the level of development of the state they are based in or tied to, etc.

Firms can be delinked with the GPN if they are unable to offer value to the global economy. This usually occurs due to a change in internal capability and external interaction, and leads them to be unable to meet the changes in market demands or the rise of newer technology.

Governments & GPNs
A government cannot create a GPN, but can provide a favourable environment for development of local firms and facilitate the plugging in of local firms into the GPN. Development of local firms can be conducted by providing incentives (such as lower profit taxes and allowances for R&D), the construction of hard infrastructure and the establishment of soft infrastructure. With this, the internal capabilities of local firms would be maximised, and they can be valuable to other firms and be able to form relations, thus plugging them into the GPN.

Singapore has taken a pro-active approach to improving the investment and trade environment in Singapore. Government policies play an important role in the development of infrastructures and the provision of skilled labour (through investments in higher education, etc), but this does not develop a GPN, only facilitate the plugging in of local firms.

Other examples include NAFTA, and TPP, which favour local firms in their respective countries, and this facilitates the plugging into the GPN.

If the government doesn't have strict rules and regulations and respective enforcement, it may also lead to the plugging out of a GPN. For example, when the civil society highlighted the unsafe workplace environment in China-based suppliers, it leads to establishment of ethical and environmental standards and ethical and environmental concerns. This led to them being plugged out of the GPN if the companies do not meet the demands of the international community and the global market. Another example would be if a country has poor worker's rights such as in Africa, the international may avoid it and the civil society may raise concerns, and this leads to plugging out of the GPN. This might also further propagate underdevelopment and uneven development.

Summary of 'The Future of Factory Asia: A tightening grip'

Value of the Environment and Resource Appraisal

Approaches on how we value the enviornment

Resource Appraisal
A resource does not refer to a substance but a function. Resources are fundamental and a prerequisite for development. Every major civilisation was sustained by a particular set of resources and technology for their exploitation, such as the Stone Age, the Bronze Age, the Iron Age, the IDL (Industrial Revolution period) and the NIDL (post-Industrial Revolution period).

What is a resource changes over time and space, and is determined by the knowledge and technology of communities.

Resource appraisal is the evaluation of a resource, which is assessed based on its ability to satisfy the needs of the community.

Examples of civilisations,their particular set of resources (in form of substances and tools), and their level of technology and knowledge:
Indus Valley Civilisation
Ancient Egypt
Ancient Mesopotamia
(Ancient) Japan
Mayan empire

Examples of particular eras and their specific set of resources
Stone Age: https://www.youtube.com/watch?v=-qq_1lcMrDM
Bronze Age: https://www.youtube.com/watch?v=ErOitC7OyHk
Iron Age:
Industrial Revolution:
Post-Industrial Revolution:

Factors which influence resource appraisal:
1. Cultural
Value systems and traditions vary across different groups of people, in turn influencing how resources are appraised and managed. This may occur on a global, regional, or local scale.
Local scale: Within communities
For example, within the Mayan community in central America, one group pushed for deforestation and another group protested against it. This thus exacerbated a prolonged drought, which forced populations to abandon their cities. This may have been a reason for the collapse of the Mayan empire.

Regional scale: Within regional organisations
Global scale: Within the world; Between countries