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Modern products are manufactured across multiple countries through interconnected networks orchestrated by corporations and controlled by capital. Different production stages are located in different countries based on labor costs, regulations, proximity to markets, and access to resources. These networks reveal that value is distributed highly unevenly—workers in poor countries earn minimal wages while corporations and consumers in rich countries capture most profits.
Trace a specific commodity from raw material extraction through processing, manufacturing, and consumption. Map which countries and workers are involved at each stage. Calculate how profit is distributed across the chain. Examine labor conditions and environmental impacts at each location.
Globalization does not erase the importance of location; where something is made still matters enormously. Companies do not choose locations randomly—they deliberately exploit differences in wages, labor rights, environmental regulations, and political power. Global networks do not automatically raise all workers' incomes; they often cheapen labor and degrade working conditions.
From economic geography, you know that production is distributed unevenly across space — that location matters because of factor endowments, infrastructure, labor markets, and institutional conditions. Global production networks (GPNs) describe the organizational form through which corporations exploit these geographic differences at planetary scale, deliberately fragmenting production processes and distributing each fragment to where conditions are most favorable.
The key insight is that modern products are rarely made in a single place. An iPhone assembles components from dozens of countries — rare earth minerals from the Democratic Republic of Congo, fabricated chips from Taiwan, screens from South Korea, software from California, and final assembly largely in China. But this is not a neutral geographic fact. It reflects deliberate decisions by lead firms — typically headquartered in wealthy countries — to break the production process into modular stages and source each stage from wherever costs are lowest, labor rights weakest, or proximity to markets most valuable. The spatial logic of GPNs is therefore a logic of exploitation of geographic difference, not merely geographic efficiency.
Value chain analysis, developed by economists like Gary Gereffi, traces the sequence of activities from raw material extraction through processing, manufacturing, distribution, and consumption — and more importantly, asks *where value accumulates* at each stage. The consistent finding across apparel, electronics, agriculture, and other sectors is that the highest-margin activities — design, branding, intellectual property, retail, and finance — are concentrated at the ends of the chain, in wealthy countries. The physically intensive middle stages — sewing, component assembly, agricultural harvest — are distributed to where labor is cheapest. A $100 pair of sneakers might contain $3 in labor costs from the worker who assembled them. The rest is captured by brand, retail, logistics, and finance.
This has two implications your economic geography background primes you to appreciate. First, agglomeration still matters: rather than dispersing production randomly, GPNs generate new industrial clusters — the Pearl River Delta in China, the Maquiladora zone along the US-Mexico border, the garment districts of Bangladesh and Cambodia. Firms locate near each other to share suppliers, infrastructure, and skilled labor. Globalization reshapes *which* places become nodes of production, not whether place matters. Second, regulatory arbitrage is systematic, not accidental. Firms locate pollution-intensive production in countries with weaker environmental enforcement, labor-intensive stages where union organizing is suppressed, and intellectual property in low-tax jurisdictions. The geography of global production is therefore partly a map of governance differences — and changing those differences (through labor organizing, environmental regulation, or trade policy) directly affects where production locates.
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