The Role of the State in Disrupting the Distribution of Power within GVCs

The Role of the State in Disrupting the Distribution of Power within GVCs

NB: This post is part of a symposium on law and global value chains co-convened with the Institute for Global Law and Policy’s Law and Global Production Working Group.

Ioannis Kampourakis–

The research Manifesto on the role of law in global value chains highlights the centrality of legal regimes for the ‘creation, structure, geography, distributive effects and governance of Global Value Chains’. The recognition of law’s constitutive role in the chain means that law is not simply an institutional backdrop for the operations of the chain but rather endogenous to GVCs. Indeed, transnational corporations that coordinate GVCs are not mere ‘context-takers’ but rather play an important role in producing the rules that govern their own operations. This jurisgenerative capacity of private corporate actors weakens democratic control over the production process and creates the potential for dis-embedding the transnational economy from social values and relations. Yet, the law that is endogenous to GVCs is not impenetrable to attempts to introduce such values within it, as recent “corporate sustaintability laws” imposing transparency requirements have illustrated. The normative project of ‘politicizing’ the endogenous law of GVC capitalism by injecting public values within regimes of private governance has the capacity to limit corporate rationalities of profit-maximization and to generate progressive social reforms across the chain. However, such attempts can only incompletely realize the goal of subjecting GVCs to democratic accountability, while they might reinscribe a neo-colonial dynamic, in which it is up to consumers and investors in the Global North to police the practices of firms exploiting workers and extracting resources from the Global South. Insofar as national and international law remain powerful inscriptions of democratic legitimacy with the capacity to steer collective life beyond market rationalities, any normative undertakings that seek to disrupt the current distribution of power within and across GVCs must also be channeled through them.

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LPE Approaches to Migration and the Labor Market

This post comes out of the early career workshop ‘Law and Political Economy in Europe’which took place at the Centre for Socio-Legal Studies, at the University of Oxford, on the 7th of October 2019. For all the posts this series, click here.

Manoj Dias-Abey –

PoliticsineuropePlenty of leftists continue to make the case for limiting migration and enforcing border restrictions. For example, in the UK, union leader and close Jeremy Corbyn ally Len McCluskey maintains that the “influx of people willing to work for less money and put up with a lower standard of living” drives down wages. Even Bernie Sanders has come perilously close to sanctioning a nationalist and protectionist stance when it comes to migration by arguing that “open borders” is a Koch brothers’ conspiracy.

Whether we give credence to these claims will depend on how we conceptualize labor markets. If we accept the fiction of national labor markets, and further assume that these markets are governed by the forces of demand and supply, then perhaps these claims might ring true. However, if we understand that labor markets are created by institutions and social forces, then we might look to factors other than supply to explain the phenomenon of declining wages and deteriorating working conditions. In this short post, my aim is to provide two alternative ways of seeing labor markets, and to trace how the impact of migration might be conceived within each. In setting out the neoclassical economists’ vision of labor markets and contrasting it with conceptualizations by more heterodox economists, I pay particular attention to the role attributed to law in each of the models.

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Labor Law and Economic Governance in the EU

This post comes out of the early career workshop ‘Law and Political Economy in Europe’which took place at the Centre for Socio-Legal Studies, at the University of Oxford, on the 7th of October 2019. For all the posts this series, click here.

Marco Rocca –

PoliticsineuropeAt the Oxford Workshop, I explored the relationship between the EU economic governance and labor law. In particular, I looked into legal tools of austerity politics and analyzed the role of the Court of Justice of the European Union (CJEU) in cementing this agenda.

During the economic crisis, leadership at the European Central Bank, and the EU Commission resorted to new tools of economic governance across the EU. Their implementation shows how the law can be instrumentalized to actively reduce the ability of trade unions and labor regulations to bring about the decommodification of the factor of production that is labor. This of course builds upon power imbalances in a given situation, in this case, between ‘creditors’ and ‘debtors’, ‘core’ and ‘periphery’ of the European Union.

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Just Transitions?

Sarah Krakoff –

 

“Either Way the Outlook is Dire, Especially for the Poor.” So concludes a journalist after reviewing a draft report by the International Panel on Climate Change (IPCC) on the environmental justice and human rights consequences of climate change. The 800-plus page report, which is not yet publicly available, details the effects of a 1.5 degree Celsius increase on food systems, water, shelter, infrastructure, and health. Even if countries meet their pledges under the Paris Accords (from which the U.S. withdrew under President Trump) 1.5 degrees of warming by 2030 is locked in. If countries fail to meet their commitments, the world will be well on its way to 2 degrees of warming or more.

 

“The risks to human societies … are higher with 1.5 degrees Celsius of global warming compared to today, and higher still with 2 degrees Celsius global warming compared with 1.5 degrees … These risks are greatest for people facing multiple forms of poverty, inequality and marginalization. —Draft IPCC Report, 2018

On one hand, there is nothing new about this. Environmental harms, and harms of all sorts, have disproportionate impacts on people, communities, and regions with preexisting vulnerabilities. Earthquakes, fires, floods, and drought do not themselves discriminate. But structural wealth insulates people from the ill effects of natural disasters and helps them to recover more quickly. As Mike Davis and John Mcphee have documented, albeit in distinct tones, wealth also constructs the very path of nature’s disasters, steering them away from privilege to the extent possible. Malibu’s ritzy canyon dwellers benefitted from fire suppression, and Pasadena’s craftsmen-style homes from the lassoing of the Los Angeles River, while L.A.’s population as a whole lost public spaces and healthy riparian areas. Climate change has made the unnatural inequalities of natural disasters more visible and acute, but the landscape of injustice preceded sky-rocketing greenhouse gas emissions. Laws, including environmental laws, sometimes shaped that unjust landscape, and at others did little to counter the unequal distribution of environmental and economic benefits.

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International Investment Arbitration in Critical Focus

David Schneiderman – 

How might we come to better understand the complex, multilevel, and interdependent world in which we live? This is a particular challenge for international and global legal scholars whose methods of analysis typically are confined to empirically observable legal phenomena in the form of international conventions, treaties, custom, and the like. In this post, I propose bringing international legal studies into conversation with a particular branch of international political economy (IPE), one that brings both an interdisciplinary and a critical edge to the global study of law.

The field of IPE in the English-speaking world has been described as being divided between two competing schools. A U.S. version emphasizes the testing of scientific models via empirical methods, focusing on state behavior as its unit of analysis. Modeled on ‘hard science,’ the U.S. version adopts a state-centric view. A more ambitious British version aims to be more qualitative and normative, emphasizing society, power, and history. It is this latter version that merits attention from legal scholars. It is a mode of analysis that is more interpretive than narrowly empirical, asking what values are promoted and who benefits from particular institutional arrangements. Susan Strange, one of the founders of the British school, has defined the study of IPE as concerning: ‘the social, political and economic arrangements affecting the global systems of production, exchange and distribution and the mix of values reflected therein. Those arrangements are not divinely ordained, nor are they the fortuitous outcome of blind chance. Rather they are the result of human decisions taken in the context of man-made institutions and sets of self-set rules and customs.’

This is a mode of analysis that will be familiar to critical scholars working in many disciplines, but an IPE approach has the advantage of thinking about contemporary global problems on multiple scales. Critical IPE is ontologically inclined, in other words, to theorize law as interacting with actors operating at various levels. It looks to the ‘complex whole,’ Robert Cox writes, rather than to the separate parts.’ Cox, in his own work, helpfully distinguishes between ‘problem solving’ theory and critical theory. The first has as its object the smooth operational working of international institutions. Such approaches serve ‘particular national, sectional or class interests.’ Problem solving is about managing the world, not changing it. Critical theory within IPE, by contrast, does not take institutions or relations of power for granted. It attends instead to how they arise and change. This is a style of understanding the world that is both multidisciplinary and normative.  It is, as Benjamin Cohen puts it, about ‘making the world a better place.’

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