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Essay / Labor exchange in global supply chains and corporate offshoring activities
By definition, although it varies, globalization is a dynamic process of liberalization, openness and large-scale integration of markets, from labor to goods and services. to capital and technology that cross borders (Dehesa, 2006). In general, economic globalization is examined in two ways: trade liberalization and capital liberalization (increase in foreign direct investment) (Locke, 2013). This thesis focuses on labor trade in global supply chains and various corporate offshoring activities, and another dimension, capital liberalization, is not covered. In general, diversification and growth of supply chains are granted to provide the necessary investment, jobs, technology and international market access. Thus, the integration of marginalized workers located in developing countries into GSCs is expected to contribute to economic development (Locke, 2013). Say no to plagiarism. Get a tailor-made essay on “Why violent video games should not be banned”?Get the original essay Along with trade liberalization, the rapid expansion of globalized commercial activities has been recognized from the post-Second era World War, accompanied by the emergence and spread of multinational enterprises (MNEs) (Frobel et al., 1981; Hirst et al., 2009). In particular, during the 1960s, a significant trend toward supply chain fragmentation and offshoring of activities in search of low-cost labor and materials emerged alongside the rise of multinationals; “be a locally incorporated entity but under foreign control” (Kline, 2010: 47). During the 1980s, this trend accelerated with the agreement of the Washington Consensus; set of policy recommendations for developing countries. The content of this consensus is the implementation of liberal norms such as trade and financial liberalization, deregulation, limited government and privatization (Held and McGrew, 2000). It transformed the role of States, moving from a role of direct operator in development to a role of institutional framework for private companies. As for commercial entities, they are seen as a “development tool” in terms of creating wealth by generating jobs and providing goods and services, but recognizing little responsibility for the impact of their activities (Blowfield and Dolan, 2014). Since then, GSCs have grown significantly around the world. In recent decades, it covers not only manufacturing industries but also energy, agriculture and various types of service industries such as call centers and accounting for research and development activities (Gereffi, 2013 ). However, many researchers argue that liberal trade is out of control and beyond hypothesis. Joseph Stiglitz (2007) and Chang (2007) argue that current trade has failed to create a win-win relationship. With easier access to international markets, large multinationals are taking advantage of this opportunity to circumvent regulations by moving production to countries where regulations are non-existent or less enforced and seek cheaper raw materials and labor . However, in terms of developing countries' labor and resource markets, they are likely to face intensified competition and exploitation because they are not ready, 2014).