E-Commerce and Industrial Upgrading in the Chinese Apparel Value Chain

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Abstract

The economic and social gains from electronic commerce (e-commerce) that promote innovation, industry upgrading and economic growth have been widely discussed. China’s successful experience with e-commerce has had a positive effect in transforming consumer-goods sectors of the economy and motivating economic reform. This article looks at how e-commerce reduces barriers to entry and enables firms to move up the value chain by using the global value chain framework to analyse the impact of e-commerce on the upgrading trajectories and governance structures of China’s apparel industry. For large Chinese brands, e-commerce has enabled end-market diversification. For small- and medium-sized enterprises, e-commerce has facilitated entry with functional upgrading as well as end-market upgrading. In the “two-sided markets” created by platform companies, the “engaged consumers” are the demand side of this market, and “e-commerce focused apparel firms” are the supply side of the new market. Consumers and platforms are more directly involved in value creation within this emerging internet-based structure.

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10.1080/00472336.2018.148122

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Li, Fuyi, Stacey Frederick and Gary Gereffi (n.d.). E-Commerce and Industrial Upgrading in the Chinese Apparel Value Chain. Journal of Contemporary Asia. 10.1080/00472336.2018.148122 Retrieved from https://hdl.handle.net/10161/19737.

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Gereffi

Gary Gereffi

Professor Emeritus of Sociology

Gary Gereffi is Emeritus Professor of Sociology and Director of the Global Value Chains Center at Duke University (https://gvcc.duke.edu/).  He has published over a dozen books and numerous articles on globalization, industrial upgrading, and social and economic development, and he is one of the originators of the global value chains framework.  His most recent books are:  Handbook on Global Value Chains (co-edited by Stefano Ponte, Gary Gereffi and Gale Raj-Reichert), Cheltenham, UK: Edward Elgar Publishing. 2019); and Global Value Chains and Development: Redefining the Contours of 21st Century Capitalism (Cambridge University Press, 2018).  Current projects include:  (1) the impact of U.S. protectionism on jobs and regional trade agreements; (2) evaluating how the digital economy and Industry 4.0 are likely to affect international business strategies and industrial upgrading; and (3) shifting regional interdependencies in East Asia and North America, with a focus on China, South Korea and Mexico vis-à-vis the United States.


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