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Global commodity chains

6 important questions on Global commodity chains

What are three characteristics of a global commodity chain?

A commodity chain includes activities that bring a product into being, such as design, production, marketing and distribution. These activities can be contained within a single firm or between firms in a single country.
In a global commodity chain, the activities are divided among different firms across different countries
A global commodity chain analysis draws attention to the power of global buyers (such as Deckers in Timmerman's chapter) over suppliers dispersed across countries.. And how this power worsers working conditions for laborers by creating fierce competition between suppliers)

What is a sweatshop?

Sweatshops are workplaces in which workers are employed at very low wages, work for very long hours, and under unsafe or unhealthy working conditions.

What were the two reasons that in the 20th century sweatshops were linked to globalization?

The international trade barriers went down and buyers from the advanced economies of the worl rushed to meet increased consumer demand at lower costs.

What is the ''race to the bottom?''

It was widely argued in the early 2000s that global buyers caused a ''race to the bottom'' by worsening working conditions and creating sweatshops in the developing world. •Raceto the bottomincludes not onlyworkingconditions (low pay, long, unregulatedhours of work, unpaidover-time, insufficient time-off) but alsolivingconditions.
•Poorhousing, infrastructure, sanitation, health
•Oftenseparationfromfamily (in case of rural-to-urban migrants)
•Bondage?

What social and economic conditions (3) exist in China that enable the formation and sustenance of sweatshops?

A mass of unskilled and unorganized laborers: farmers flock to cities
management systems that neglect the human factor of labor: factory management does not observe laws and regulations
Lack of accountability for poor working conditions, or failure of governments to intervene on the behalf of workers

What sustains the race to the bottom in China?

Government interest: Chinese government is actually invested in the growth of the economy and does not want to scare away global buyers. Half of the yearly production of world's shoes take place in China. The growth contributes to the formation of a middle class in China that American companies such as Wal-mart would like to lure as consumers.