Beyond the Producer-driven/Buyer-driven Dichotomy: The Evolution of Global Value Chains in the Internet Era

Authors: 
Publication Type: 
Journal Name: 
Volume: 
32
Number: 
3
Page Numbers: 
30-40
Total Pages: 
11
Month/Season: 
Published On: 
2001

The Internet is still in the early stages of its development, but its impact on global value chains is already evident. While it may be premature to try to identify lasting changes on producer-driven and buyer-driven chains, several possible scenarios are emerging and they are not mutually exclusive. The first scenario is that electronic commerce will lead to the emergence of infomediary-based value chains that privilege direct on-line access to consumers. A second scenario is that the Internet is really just extending the logic of buyer-driven chains as both information and power continue to shift inexorably from manufacturers, marketers and retailers to consumers. A third scenario is that the impact of the Internet will be captured and integrated into the practices of large established companies, thus reinforcing power relationships in existing producer-driven and buyer-driven governance structures. Although there is evidence to support all three scenarios, the third model currently seems to be dominant.