The Role of Law in Global Value Chains: A Research Manifesto

Abstract

Most scholars attribute the development and ubiquity of global value chains to economic forces, treating law as an exogenous factor, if at all. By contrast, we assert the centrality of legal regimes and private ordering mechanisms to the creation, structure, geography, distributive effects and governance of Global Value Chains (GVCs), and thereby seek to establish the study of law and GVCs as rich and important terrain for research in its own right. Across a growing number of sectors and industries, value production is not just transnational in scope; it is organised and coordinated via global networks that link activities across as well as within firms and nations. These networks are increasingly referred to as ‘Global Value Chains’, or GVCs. The asserted causes of this phenomenon are multiple, and scholars debate which deserves designation as primary.1 We begin from the premise that GVCs are not only the product of shifting economic conditions. They also arise as firms engage dynamically with multiple, overlapping and often conflicting local, national, regional and transnational legal regimes, soft-law normative orders and private ordering mechanisms (hereinafter collectively described as ‘law’).2 This article seeks to establish the importance for both scholars and policymakers of investigating some of the complex ways in which the law shapes and is shaped by GVCs. The research agenda articulated here emerged from a series of ongoing conversations among a group of legal scholars, sociologists and political economists that first met in June 2014 under the auspices of the IGLP at Harvard University. For the most part, legal scholarship has only summarily or incidentally analysed GVCs, and similarly, GVCs scholars outside law have not made law a focal point of their theoretical or empirical analyses. We believe that placing law at the centre of the analysis of what have historically been treated as primarily ‘economic structures’ will not only enrich our understanding of the shape, nature and dynamic character of GVCs, but will also help to illuminate the complex inter-relationship between law and global political economy more broadly. We begin with a broad description of the question at the heart of our collective inquiry: how does law shape the structure and organisation of production globally and how is law impacted through this process? To make this meta-question more concrete, we articulate three thematic starting points for exploration of the relationship between law and GVCs: law and the geography of GVCs; law and the production and distribution of value and power in GVCs; and law and the coordination of GVCs (the latter being a process referred to in the GVC literature as ‘governance’). We focus our research inquiry into the role of law in global structures of production on GVCs both because of their ubiquity in modern capitalism and the rich variety of extant scholarship (largely outside the field of law) exploring GVCs in a variety of industries and contexts. This combination of factors makes GVCs a rich source for research both empirically and theoretically. In an effort to suggest, albeit in a highly preliminary way, what a legal analysis of GVCs might entail, and what insights this line of inquiry might yield, we include brief descriptions of several ongoing research projects initiated by group members. Our goal is to invite scholars in law and related disciplines to begin to view the study of law and global production as an important and worthy field of research in its own right.