Chains of Love? Global Production and the Firm-Level Diffusion of Labor Standards

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2018-07-01

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Abstract

©2018, Midwest Political Science Association Under what conditions does the global economy serve as a means for the diffusion of labor standards and practices? We anticipate variation among internationally engaged firms in their propensity to improve labor standards. Upgrading is most likely when a firm's products exhibit significant cross-market differences in markups, making accessing high-standards overseas markets particularly profitable. Additionally, upgrading is more likely when lead firms attach a high salience to labor standards. Therefore, while participation in global production induces “trading up” behaviors among firms overall, the effect strength varies across industries. We test our expectations via a survey experiment, which queries foreign firms operating in Vietnam about their willingness to invest in labor-related upgrading. We find strong evidence for the effect of markups on upgrading choices and suggestive evidence for the saliency mechanism.

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10.1111/ajps.12370

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Malesky, EJ, and L Mosley (2018). Chains of Love? Global Production and the Firm-Level Diffusion of Labor Standards. American Journal of Political Science, 62(3). pp. 712–728. 10.1111/ajps.12370 Retrieved from https://hdl.handle.net/10161/17724.

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Malesky

Edmund Malesky

Professor of Political Science

Malesky is a specialist on Southeast Asia, particularly Vietnam. Currently, Malesky's research agenda is very much at the intersection of Comparative and International Political Economy, falling into three major categories: 1) Authoritarian political institutions and their consequences; 2) The political influence of foreign direct investment and multinational corporations; and 3) Political institutions, private business development, and formalization.


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