Embeddedness beyond the lead firm in global production networks: Insights from Kenyan horticulture

Abstract

Recent research on embeddedness in global production networks (GPNs) has begun to move beyond the dominant perspective on how lead firms embed into host countries to investigate how non-lead firms embed across multiple scales in a GPN. This paper builds on such work by examining both processes of how, and the extent to which, different Southern suppliers embed into GPNs, detailing the contestation, struggles, and synergies faced. Empirical evidence is provided through a case study of Kenyan horticulture. Using a mixed-method approach of interviews and surveys, the paper finds that Kenyan farmers and Kenyan export firms (KEFs) have varied ways in which they embed, with farmers more embedded (highly dependent on network relationships and participation in a GPN) and KEFs simultaneously less embedded (having a low degree of commitment towards farmers) in GPNs. Overarchingly, the results demonstrate the need to account for the complex ways in which non-lead firm actors like Southern suppliers embed in GPNs.

Inside-out strategic coupling for smallholder market integration – Mango production in Malawi as a test case

“…Achieving territorial embeddedness in a region encompasses the creation of local linkages, knowledge transfer, but also much more than that. More research is needed to asses, for instance, the caring commitment of agribusinesses (Krishnan, 2023). What is missing completely in this analysis, is an ecological dimension.…”

“…The different dimensions of territorial embeddedness can be proxied by a number of indicators (Atienza et al, 2021). Among others, linkages with local firms (Kleibert, 2015) and knowledge transfer (Krishnan, 2023) are factors that contribute to territorial embeddedness, which in turn affects the prospects for economic and social development in specific locations. Knowledge transfer occurs when there is a transfer of technology and a mutual exchange of explicit and intangible or tacit information (Krishnan, 2023).…”

“…Among others, linkages with local firms (Kleibert, 2015) and knowledge transfer (Krishnan, 2023) are factors that contribute to territorial embeddedness, which in turn affects the prospects for economic and social development in specific locations. Knowledge transfer occurs when there is a transfer of technology and a mutual exchange of explicit and intangible or tacit information (Krishnan, 2023). Thus, local linkages and knowledge transfer are essential components of territorial embeddedness.…”

“…GPN is increasingly used to analyse the global organisation of agricultural production, and both the positive and negative impacts of global market integration on smallholders are widely discussed (Alford, 2016;Dorn and Huber 2020;Franz et al, 2018;Grabs and Ponte 2019;Krishnan, 2023;Neilson et al, 2018;Tups and Dannenberg 2021;Vicol et al, 2019). Applying the lessons from this work could benefit agricultural development interventions: recognising the broader social and institutional context reveals synergies between agriculture and broader rural development efforts, such as land use planning, infrastructure development or poverty reduction programmes.…”

Structural transformation in South Africa:

“…Much of this literature has highlighted paths for actors to 'move up the value chain' for economic gain-identifying the sources of capabilities that facilitate access to new markets Morrison et al, 2008) and/or how knowledge and information flow within value chains between lead firms and their suppliers . The research agenda on upgrading has recently moved from the examination of its economic and social aspects to the consideration of environmental concerns as well-and thus to the processes that can improve or minimize the environmental impact of GVC operations, including production, processing, distribution, consumption, and disposal or recycling (De Marchi et al, 2013;Krishnan, 2017).…”