A commodity chain is defined as ‘a network of labour and production processes whose end result is a finished commodity’ (Hopkins and Wallerstein, 1986:159). Over time, different methodologies have emerged for their analysis. Value chain analysis, for instance, is used to identify which activities are best undertaken by a business and which are best provided by others, or outsourced. The value chain describes the full range of activities required to bring a product or service from its conception, through the different phases of production (involving a combination of physical transformation and the input of various producer services), delivery to final consumers, and final disposal after use. In this type of analysis, production per se is only one of a number of value-added links (Tallec and Bockl, 2005).
The primary focus of global commodity chain (GCC) analysis is the international trading system and the increasing economic integration of international production and marketing chains. Introduced by Gereffi during the mid-1990s, the GCC concept was developed within an analytic framework of the political economy of development and underdevelopment, originally derived from world-system theory and dependency theory. It was developed primarily to analyse the impact of globalisation on industrial commodity chains. GCC highlights power relations that are embedded in value chain analyses. It has shown that many chains are characterised by a dominant party (or sometimes parties) that determines the overall character of the chain. This analysis distinguishes between two types of governance: those cases where the coordination is undertaken by buyers (‘buyer-driven commodity chains’) and those in which producers play the key role (‘producer-driven commodity chains’) (Tallec and Bockl, 2005). The relatively capital-intensive manufacture of automobiles, aircraft and electrical machinery can be thought of as examples of producer-driven commodity chains.
‘Approche Filière’, translated as Commodity Chain Analysis, CCA, is applied to the analysis of existing marketing chains for primarily agricultural commodities, assessing how public policies, investments and institutions affect local production systems (Raikes et al., 2000; Tallec and Bockl, 2005). Filière analysts have borrowed from different theories and methodologies, including systems analysis, industrial organisation, institutional economics (old and new), management science and Marxist economics, as well as various accounting techniques with their roots in neoclassical welfare analysis (Kydd et al., 1996: 23). The empirical aspect of this approach involves mapping out actual commodity flows and identifying agents and activities within a filière, and aims at a measure of inputs and outputs, prices and value added along a commodity chain. In addition, there is an anthropological tradition within filière works which focuses on markets and power in a ‘real-world’ sense. From this point of view, the approche filière is related to the GCC approach (Raikes et al., 2000).
References
Hopkins, T. and Wallerstein, I. (1986) Commodity chains in the world economy prior to 1800. Review X (1) 157-170.
Kydd, J., Pearce, R. and Stockbridge, M. (1996) The Economic Analysis of Commodity Systems: Environmental Effects, Transaction Costs and the Francophone Filière Tradition. presented at the ODA/NRSP Socio-Economics Methodology (SEM) Workshop, ODI: London, 29-30 April 1996.
Raikes, P. et al. (2000) A Global Commodity Chain Analysis and the French Filière Approach: Comparison and Critique. Economy and Society 29(3) 390-417.
Tallec, F. and Bockl, L. (2005) Commodity Chain Analysis. Constructing the Commodity Chain Functional Analysis and Flow Charts. Food and Agriculture Organization of the United Nations (FAO), Rome, Italy. Online under: www.fao.org/tc/easypol.
For further reading:
Gereffi, G. (1996) Global Commodity Chains: New Forms of Coordination and Control Among Nations and Firms in International Industries. Competition and Change (4) 427-439.
This glossary entry is based on contributions by Willi Haas, Simron Jit Singh and Annabella Musel
EJOLT glossary editors: Hali Healy, Sylvia Lorek and Beatriz Rodríguez-Labajos
