The Political Economy of Inequality in a World of Global Value Chains

This paper seeks to link together two sets of debates: those concerning global inequality, on the one hand, and those relating to the evolution of a global economy dominated by global value chains (GVCs), on the other. Rooted in perspectives from International Political Economy (IPE) and seeking to bring them into dialogue with insights from economic sociology, the paper argues that the core logic of the ‘GVC world’ rests on the mobilisation of massive asymmetries of market, political and social power, and focuses on how this logic produces the unequal outcomes that have compellingly documented by Piketty and others in recent work. The discussion looks in detail at the nature of these asymmetries and how they function in different geographical, political-economic and sectoral contexts, and links them to the evolution of global economic inequalities at both macro and micro levels. On this basis, the paper’s arguments offer a critique of the recent excitement around the notion of ‘GVCs for development’, espoused by many international organisations, development agencies and national governments – and the subject of a considerable academic literature. This new development mantra risks obscuring the ways in which the logic of GVCs generate and/or reinforce structures of socio-economic inequality, and neglects the dynamics of power and asymmetry which are integral to them.