Commodity Chains Research Paper

1. Conceptions Of Commodity Chains

Since the middle 1970s there has been a resurgence of interest in space conceptualized not as a homogenous expanse of territory, but as channels, networks, nodes and chains of connection. In economic geography the main interest resides in investigating the spatial organization of business networks ( Yeung 1994). Related to this interest, commodity chain analysis differs in that analysis focuses on the commodity, rather than industrial organizations or networks of inter-firm relations. The geographical literature contains numerous references to concepts similar to commodity chains. For example, Harvey (1989, p. 101) implies the notion of a commodity chain in arguing the importance of knowing the effects of consumption on the conditions of production: ‘We can take our daily breakfast without a thought for the myriad of people who engaged in its production. All traces of exploitation are obliterated in the object.’ However, the commodity chain concept only began to be used formally in the middle 1980s. Three versions of commodity chain analysis can be discerned: global commodity chains, systems of pro-vision, and commodity circuits. These versions have recently been criticized as limited in scope and applicability, and an expanded commodity chain concept proposed.

1.1 Global Commodity Chains

The notion of commodity chains has been developed in the world systems approach in sociology with extensions in the literature of economic geography (Hopkins and Wallerstein 1986 and Gereffi 1994). As characterized by the world systems approach, a commodity chain refers generally to a network of labor and production processes whose end result is a finished commodity (Hopkins and Wallerstein 1986, p. 159). Gereffi and his co-workers see inter-organizational networks linking households, enterprises, and states to one another within the world economy (Gereffi et al. 1994, p. 2). Global commodity chains stress the organizational scope of transnational production arrangements, that is the linkages between economic agents, such as raw material suppliers, factories, traders, and retailers. In this view, commodity chains have three main dimensions: (a) an input-output structure, in the sense of a set of products and services linked together in a sequence of value-adding economic activities; (b) territoriality, as with spatial dispersion or concentration of production and marketing networks; and (c) a governance structure, in terms of authority and power relationships that determine how financial, material, and human re-sources are allocated and flow within a chain.

Two distinct types of governance structure are distinguished: producer-driven and buyer-driven commodity chains. In producer-driven commodity chains, transnational corporations or other large integrated industrial enterprises control the production system. In buyer-driven commodity chains, large retailers, brand-named merchandisers, and trading companies set up decentralized production networks in exporting countries, typically in the Third World. The latter pattern of trade-led industrialization is common in labor intensive, consumer goods industries such as garments, footwear, toys, household goods, consumer electronics, and a wide range of handcrafted items, such as furniture or ornaments. International contracting is generally carried out by independent Third World factories making finished goods, rather than components or parts, under original equipment manufacturer arrangements, and with specifications sup-plied by the buyers and branded companies that design the goods (Gereffi 1994, p. 219–22). In these studies firms comprise the main unit of analysis and unequal distributions of wealth along the chain are explained as outcomes of firm competition and innovation.

1.2 Systems Of Provision

A second approach to commodity chain analysis derives from Fine and Leopold’s (1993, p. 600) rejection of horizontal analyses of consumption that stress commodification and aestheticization connected with retailing, and their favoring, instead, of the vertical dimension of the system of provision—the commodity-specific chain connecting production, distribution, marketing, and consumption, and the material culture surrounding these elements. Different systems of provision result from distinct relationships between material and cultural practices spanning the production, distribution, and consumption of goods (Fine and Leopold 1993). This perspective allows for a more dynamic consideration of consumer behavior in economic transformations within advanced capitalist economies.

Some accounts argue that production is now consumer-driven (Piore and Sabel 1984), while others emphasize technological change or regulatory institutions in producing economic change ( Harvey 1989). It has been argued that both sets of literature inadequately conceptualize consumption, and that a system of provision approach allows for a more balanced treatment of the relationships between production and consumption (Leslie and Reimer 1999, p. 405). Fine and Leopold (1993, p. 28) also recognize the changing relationships between the symbolic meanings of goods and their physical contents. Thus it is important to trace not only commodity movements over space, but also the discourses and representations operating in systems of provision.

1.3 Commodity Circuits

A third approach to commodity chain analysis, tracing commodity circuits, combines work in the political economy tradition with ideas derived from post-structural social theory. The notion of a circuit of culture has been used in examining the ways geo-graphical knowledge of commodity systems is shaped and reshaped and in showing how particular cultural artifacts move through the circuit. Unlike the notion of a chain, circuits have no beginning or end, but instead Cook and Crang (1996) envision dense webs of interactions between all sites, with commodities inter-relating with other goods as they travel. Rather than privileging one site, such as production, in interpreting the meaning of a commodity, explanation lies in combining a number of different processes. An appropriate politics of consumption recognizes the fragmentary and contradictory nature of the knowledges through which commodity systems are imagined (Cook and Crang 1996). Rather than assuming that consumers have little awareness of the quality and geographical origins of commodities, this approach sees commodity circuits constructed and reconstructed through consumer knowledge. This view might be criticized for eventually abandoning the concept of a chain altogether and for neglecting ideas of consumer resistance and activism (Leslie and Reimer 1999).

2. Recent Tendencies In Commodity Chain Analysis

Although useful in terms of conceptualizing the connections between firms and actors across space in the production of final outputs, these versions of the commodity chain concept fail to connect the sign of the commodity at the consumption end with labor and the natural environment at the production end. In not following through at the consumption end, world systems theory misses a vital opportunity to connect commodity chains with advertising, popular culture, and the geography of consumption. By not tracing firms’ activities back to the conditions of workers, economic geography reduces labor to being yet another input in the overall production process, divorcing economic analysis from the politics of production. By not rooting commodity production in the natural environment, all these approaches fail to connect with political ecology, an important emerging area in critical theory ( Peet and Watts 1996). Significantly, these instances of neglect occur at the most politically sensitive sites along commodity chains, preventing the concept from uniting, in a comprehensive politics, consumption, culture, labor, and nature.

2.1 Expanded Version Of Commodity Chains

In a more complex model of commodity chains, the effects of the commodity at the consumption node, the social and natural conditions at the production node, and the complex intersections of commodity chains at various intermediating and terminal points, are added to a simple model of commodity movement. This expanded version integrates the generation of cultural (signifying and representational) effects at the consumption node with the social and natural conditions at the production end of the chain, the purpose being to show the effects of one on the other, bringing home to consumers the results of consumption. In contrast to earlier theories, this expanded formulation sees commodity movements (the vertical dimension) connecting nodes that are conceived as places (horizontal dimensions) located at different positions along commodity chains. This emphasis on place lends the analysis potential for bringing together several aspects of the production and consumption of commodities. In this vein, the commodity chain is posited as a way of tying together material and signified realities, consumption and production, and activities separated by space, providing a fuller interpretation of the material world and the real, human actors who live in it (Hartwick 1998).

2.2 Consumption Nodes

At the terminal nodal point of consumption, the radiating image of a commodity produces a halo effect of socially constructed meanings. Such meaning systems can be analyzed in a number of ways, including the aesthetics of representation and consumer taste. The preferred theoretical tradition is the semiotics of Peirce (1931–5). In such a materialist social semiotics, a commodity has two meanings: a first-order meaning at the level of function; and a second-order imputed meaning at the level of symbolic effect. Semiotic analysis tries to reveal the social prescription of the meaning of a commodity. In a postmodern sign economy, first-order meanings, based in physical needs, have been transformed into second-order representational meanings, emanating from social status and cultural allusion (Gottdiener 1995). However, for a complete explanation, the conditions of production must be included within social semiotic analysis. Stark contrasts in material and cultural conditions so intensify second-order symbolic meanings that they mutate into a third, specifically geographical, meaning-form. Images are usually added to commodities at, or near, the organizational centers of global trading systems, where the producers of sign value share the cultural norms of the consumers. Underdevelopment, unequal exchange, profit flows and power differences, vastly different conditions of life, must be hidden behind the image of the commodity to give the impression that consumption is effortless and has no negative side effects. In general, adding social semiotics to commodity chain analysis expands the horizontal analysis of commodities at the consumption end and creates awareness of vertical linkages to producers (Hartwick 1998).

2.3 Production Nodes

The conditions of production at the other terminus of the commodity chain include the social relations of production, and also relations between workers and families, hence the reproduction of the household. This, in turn, consists of social relations of reproduction (gender, class, ethnicity) and social relations with nature, including the worker-family’s reproductive use of subsistence land and resources. The complete set of the conditions of existence of the producers, and the full range of natural conditions of production that enter into the materiality of the commodity, and pass thereby into the distant bodies of consumers, are explored.

2.4 Commodity Bundles

Commodity chains articulate one with another at various nodal points of the intersection of their pathways. At the production end, commodities of prime significance form the conditions of existence for secondary commodity chains. At other significant nodes, processing points in particular, chains converge into commodity bundle that make up imaged complexes entering the consumption node—the entire complex combines to signify status, wealth, and power through radiating interconnected significations. As Glennie and Thrift (1993, p. 605) note, any commodity chain is characterized by leakiness, in both material and symbolic ways, which influences other commodity chains—they catalog the intertwining between commodities, advertising of linked pro-ducts, consumer reflexivity, and consumption across several commodity systems. Nodes of consumption are thus points of convergence for series of imaged complexes of commodity chains. In this last sense, each purchase in the market is seen as culminating in an entire complex of commodity production and representation, linking together several lines of waged workers, unwaged reproducers of waged workers, and natural resources.

3. Commodity Chains And The Politics Of Consumption

Geographical analysis centered on commodity chains connects the generation of cultural (signifying) effects within consumption to the real and material (social and natural) conditions involved in production. De-construction, understood in a geographical and materialist sense, uncovers these hidden dimensions of the commodity sign. Moving to a geographical focus on place broadens commodity analysis giving it greater political potential as a critical tool. Using this device, a series of local worlds are linked by connecting-chains into global systems. Commodity chains enable a greater awareness of the geographical implications of the political economy of consumption. Informed by commodity chain analysis, consumers learn to deconstruct, or critically analyze, the disconnected messages that bombard them by reconnecting images with material realities. Also the focus on people-in-places, as key nodal points along a commodity chain, broadens economic analysis so that social, cultural, and natural relations can be incorporated. This gives commodity chain analysis greater political potential as a comprehensive political tool. Formulated in this way commodity chains are said to constitute an analytical basis for a transformative politics (Hartwick 2000).

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