CHINA, INDIA AND GLOBAL DEVELOPMENT Identifying a research agenda on production and innovation

1. CHINA, INDIA AND GLOBAL DEVELOPMENTIdentifying a research agenda on production and innovation International Conference on Globalisation and Development in the Chinese Economic Region National Taiwan University, Taipei, 22-23 June 2007 Dr Khalid Nadvi IDPM, School of Environment & Development University of Manchester

2. The Changing Geography of Global Production - Global Value Chains and Production Networks • Global Value Chains (see www.globalvaluechains.org) • Engagement and organisation of local producers by global lead firms for production for global markets. The approach focuses on: • Identification of distinct aspects of rent generating activities within the chain • Governance of intra-firm ties (market to hierarchical ties, and in-between) • Power relations within firm-ties, in particular the relative power of the lead firm • Prospects for upgrading – product, process, functional, chain

3. From ‘Northern’ to ‘Asian’ led GVCs • Traditionally GVC lead firms are ‘Northern-based’. But increasingly Asian firms are taking on more substantive tasks in organising (e.g., ‘triangular manufacturing’ in garments). • Are Asian firms leading GVCs? If so, this raises various questions: • Are Asian led GVCs organised differently then ‘Northern-led’GVCs? • Do other developing country producers face different challenges to enter into Asian-led chains? • What are the upgrading prospects for developing country producers within such chains • How do Asian-led chains engage with global challenges around standards – especially labour, social and environmental standards?

4. What implications for Innovation? • How is the changing patterns of GVC ties in production affecting processes of knowledge development and innovation within Asian firms, and Asian economies? • Are there common patterns in the evolution of innovation capabilities and innovation systems in leading Asian economies? • How has this influenced development of capabilities in local firms? • How does this challenge existing governance ties within GVCs organised by northern lead firms, or chart new arrangements within Asian-led GVCs? • What challenges and opportunities arise from this for other developing country firms and economies?

5. Globalisation and Standards • A key agenda in global production today is related to standards compliance • Technical standards (product specific standards) • Industry-led • Closely tied to innovation and technology-led competition • Process standards • Quality, Environmental, Labour, Social, Ethical • Global (Northern) Public and Private Actors engaged in standard formulation and monitoring

6. Standards Takers or Standard Makers? • Are Asian-led GVCs, allowing Asian actors (firms, NGOs, Govt) to become standard makers? • Technical Standards • Process Standards • What consequences for? • Global standards regimes (new rules of trade) • Local Regulatory processes – public and private • For other developing country economies, firms and workers

7. Regional Networks in Production and Innovation • East Asia (‘greater China’?) marked by strong regional production networks • How critical is this to regional production dynamism? • To the ability of East-Asian lead firms to organise regional GVCs, and the consequences for producers outside of the region to enter into such chains? • To stimulate regional innovation networks • South Asia (‘greater India’?) marked by weak regional production networks • To what extent does this limit the prospects for further growth in production and innovation for South Asian led GVCs?

8. Towards a framework for comparative research • Conceptual models • GVC analysis; Innovation and learning systems literature • Cross-country sectoral case studies on: • Garments • Electronics • Software services (BPO) • Focus on case studies of Taiwanese led GVCs • FDI into mainland China and the organisation of production chains within China • FDI to other developing countries and the organisation of production chains in other developing countries • Innovation networks • Standards regimes