Markets, actors, Uganda

1. IIPPE Commodity Studies Working Group Workshop SOAS (London), 08.03.2008‘Doing value chain analysis in the field’ Jörg WiegratzUniversity of Sheffield (Department of Politics)

2. Markets, actors, Uganda • Academic interest: (a) (cultural) political economy & economic sociology of ‘markets’ (production/exchange); (b) social change & actor’s behaviour in capitalism/neoliberalism • Prior to PhD: involved in two empirical studies on value chain (VC) governance & upgrading in Ugandan context • Ugandan exporters & European importers (study 1), • Farmers&buyers (traders/processors) in Uganda (study 2) • Questionnaires (for in-depth interviews) based on mainstream GVC framework: Gereffi et al. (2005), Humphrey and Schmitz (2002) etc.

3. Rationale & focus of the two studies • Apply GVC framework to Uganda; exploratory studies (issues raised could inform the debate and be followed up by others) • Document & analyse governance systems and their dynamics, upgrading efforts of local suppliers, development implications • Focus of interviews: • Starting a relationships between VC actors: rationale, linking up, requirements, challenges at the beginning, etc. • Division of labour between supplier and buyer • Coordination, monitoring, supervision, cooperation • Advantages & disadvantages of the arrangement • Upgrading of suppliers (exporters, farmers) • Role of support institutions (and industries) • Outlook of the relationship • Support needed from Government of Uganda & other actors

4. Where did the studies lead us to? • Insightful interviews with actors (which we documented & analyzed in length in the reports, 400+pp. per study) • Learnt a lot about: coordination forms & practices, cooperation, governance drivers & changes, challenges; thus, about actor’s behaviour and inter-actor relationships • ‘New issues’ (less discussed in mainstream GVC literature; African context) such as: actors’ behaviour, emotions, (mis)trust, communication, business culture, learning, political economy (VCs actors & state, donors), etc. • Diversity of findings (economic and non-economic issues) • Can’t be (un-)covered/explained by one approach • Calls for: GVC+ (or leaving GVC framework altogether to explore particular issues?)

5. Study 1: suggestions for future GVC research • Incorporate tools & concepts of branches of social and other sciences that enrich the framework: ‘Mixing efforts’ (GVC+) could improve the approach’s (i) coverage, (ii) explanatory power and (iii) policy relevance • To date, little work on: mechanisms of communication and trust in GVCs, or emotional/psychological & normative aspects of inter-actor relations and cooperation • Deficient (macro/micro) theoretical foundation on behaviour and social relations of GVC actors (especially in African context) • Study non-economic aspects of GVC embeddedness at local nodes • Social, cultural, normative, political, institutional and cognitive pre-conditions of GVCs • Prerequisites that allow/hinder local actors to integrate/perform in GVCs and carry out related domestic VC governance in a certain way • Study domestic/regional VCs in developing countries: see deficits in organization, cooperation, trust and performance in VCs in Uganda

6. Study 2: suggestions for future VC research • Role of lead farmers as link between buyer & farmer groups • Supervisors as link between buyer’s management & farmers • Trust links and (farmers’) loyalty cycles in the domestic VC • Behaviour of arms-length’ buyers (‘non-developmental buyers’, incl. those who cheat farmers) and related effects on governance system of ‘developmental buyers’ (those who interact & cooperate with farmers beyond arms-length) • Sector’s codes of practices to ‘regulate’ behaviour of buyers • Governance tools & technologies (buyer’s rewards & sanctions systems, quality testing machines and its effects on farmers’ trust)

7. Study 2: suggestions for future VC research, cont. • Actors’ switching of business partners • Village-Kampala distance & farmers’ loyalty levels • State-buyer alliances and the ‘spillovers’ to VC governance • Role of other governors: development agencies, local politicians, support institutions/industries • Political economy & sustainability of Public Private Partnerships (PPPs) for VC development • Links between global structural forces & local VC governance systems and practices • Etc.

8. Concluding remarks • Inductive (& deductive) methods important; qualitative research (interviews) helpful & promising • Economic sociology, economic anthropology, etc. helpful • International Political Economy: way to go to be relevant & open for e.g. ‘bottom-up’ VC studies (but notable: every-day IPE, regimes of accumulation, etc.), would have to open up more to interdisciplinary field research • Mainstream GVC literature: good starting point (in absence of other research programmes & frameworks…) to inform research, develop a questionnaire, derive at findings etc.; • But mainstream governance typology (Gereffi et al. etc.) • Does not always work very well for agriculture in Uganda (e.g., ‘modular governance’?); reformulation of governance typology needed for studies in small-holder agriculture? • Ill-equipped to guide research on: (i) ‘new’ aspects mentioned above: trust, embeddedness, actor’s behaviour beyond ‘homo economicus’, subjectivity formation, role of institutions, contentious trade practices, and (ii) ‘old’ aspects of political economy including recent neoliberal ‘phenomena’ related to GVCs

9. Concluding remarks, cont. (1) • Insufficient set of independent variables: typology based on ‘firms’ not individual actors – actual human beings - in international production and trade, e.g. stand-alone traders • No ‘variables’ (or consideration) for politics, culture, non-economic (including moral) behavioural motivations • A number of issues look ‘a bit different’ in face-to-face trade context in rural UG (than suggested by mainstream view with its industry starting point) • Mainstream GVC debate somewhat ‘blind’ (‘ignorant’?) vis-à-vis some ‘unconventional’ issues and thus of limited help for research on certain aspects of global production & trade • Gibbon&Ponte seem to suggest: take the ‘escape route’ (complementary concepts), ‘frustration’ with GVC mainstream? • A range of writers from political economy, economic sociology, economic anthropology, economic geography etc. seem very relevant for a more diverse & critical analysis

10. Concluding remarks, cont. (2) • How to carry out critical analysis & field research? • Views of actors (farmers, supervisors, managers, exporters, importers, state/donor officials) on critical VC issues, data? • How to contribute to academic & policy debate, locally & internationally? • Important to carry out critical research that can actually explain local situations, raise also unconventional issues, and inform VC actors (farmers, developmental buyers etc.) & related parties • Otherwise research agenda of mainstream economics (and its proponents) will continue to overwhelm & somewhat ‘misguide’ (especially local) debates on production and trade • ‘Better’ governance typology? Different concepts? ‘Better’ set of research questions? Beyond: ‘GVCs’, ‘upgrading’ & ‘governance’?

11. Concluding remarks, cont. (3) • Main deficits of mainstream GVC approach & debate: its poor account of GVC embeddedness, actors, inter-actor relations & interaction, politics, and other points made by presenters in articles circulated. • For details/references on all points made in the presentation see: Wiegratz (2008), Wiegratz, Nyabuntu, Omagor (2007a, 2007b), Downloads: www.shef.ac.uk/politics/research/phd/jwiegratz.html • For comments, please e-mail: j.wiegratz@sheffield.ac.uk • Suggestions from Guido Starosta (group member) on field research: • Analyze average annual rate of profit (AROP) of individual capitals in the chain (comparison with AROP of economy as a whole) • Identify mechanisms of transfer of surplus value between capitals in each chain (commercial credit, unequal distribution of circulation costs, fixing unfavourable prices) & respective effect on AROP • Simulation: effect of policy related changes in conditions of circulation of capital on profitability of different individual capitals • Link between: Law of value - related social processes - objective limits of certain governance structures