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Organizing the Indonesian Clothing Industry in the Global Economy: The Role of Business Networks

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  • Peter Dicken
  • Markus Hassler
Abstract
In a relatively short period of time, Indonesia has become a significant centre of clothing production within the global economy. Its overall growth can be explained primarily by the intersection between two sets of political-economic processes: those operating at the global level of the industry in general and those specific to Indonesia itself. Within these general processes, we explore the particular organizational mechanisms through which this growth has occurred. Detailed field evidence shows how the Indonesian clothing industry is deeply embedded in production networks which connect domestic producers with international networks of production and distribution, notably those organized by Korean, Taiwanese, US, and European firms. Although such networks are generally consistent with Gereffi's concept of the buyer-driven global commodity chain, we show that the precise shape and the driver of the company-specific production networks in Indonesia are highly dependent on the specific market being served. Finally, brief attention is given to the potential impact of the current East Asian economic crisis on Indonesian clothing firms.

Suggested Citation

  • Peter Dicken & Markus Hassler, 2000. "Organizing the Indonesian Clothing Industry in the Global Economy: The Role of Business Networks," Environment and Planning A, , vol. 32(2), pages 263-280, February.
    • Handle: RePEc:sae:envira:v:32:y:2000:i:2:p:263-280
    DOI: 10.1068/a31172
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    Cited by:

    1. Bartley Tim, 2010. "Transnational Private Regulation in Practice: The Limits of Forest and Labor Standards Certification in Indonesia," Business and Politics, De Gruyter, vol. 12(3), pages 1-36, October.
    2. Ping Wang & Alison Watts, 2006. "Formation of buyer‐seller trade networks in a quality‐differentiated product market," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 39(3), pages 971-1004, August.
    3. OKUBO Toshihiro & ONO Yukako & SAITO Yukiko, 2014. "Roles of Wholesalers in Transaction Networks," Discussion papers 14059, Research Institute of Economy, Trade and Industry (RIETI).
    4. Binnur Neidik & Gary Gereffi, 2006. "Explaining Turkey's Emergence and Sustained Competitiveness as a Full-Package Supplier of Apparel," Environment and Planning A, , vol. 38(12), pages 2285-2303, December.
    5. Baiardi, Donatella & Bianchi, Carluccio & Lorenzini, Eleonora, 2015. "The price and income elasticities of the top clothing exporters: Evidence from a panel data analysis," Journal of Asian Economics, Elsevier, vol. 38(C), pages 14-30.
    6. Bob Begg & John Pickles & Adrian Smith, 2003. "Cutting It: European Integration, Trade Regimes, and the Reconfiguration of East–Central European Apparel Production," Environment and Planning A, , vol. 35(12), pages 2191-2207, December.
    7. Mike Morris & Leonhard Plank & Cornelia Staritz, 2016. "Regionalism, end markets and ownership matter: Shifting dynamics in the apparel export industry in Sub Saharan Africa," Environment and Planning A, , vol. 48(7), pages 1244-1265, July.
    8. Henry Wai-Chung Yeung, 2000. "Guest Editorial," Environment and Planning A, , vol. 32(2), pages 191-200, February.
    9. Florence Palpacuer, 2006. "The Global Sourcing Patterns of French Clothing Retailers," Environment and Planning A, , vol. 38(12), pages 2271-2283, December.
    10. Scott, Allen J., 2006. "The Changing Global Geography of Low-Technology, Labor-Intensive Industry: Clothing, Footwear, and Furniture," World Development, Elsevier, vol. 34(9), pages 1517-1536, September.
    11. N. A. Phelps, 2004. "Archetype for an archipelago? Batam as anti-model and model of industrialization in reformasi Indonesia," Progress in Development Studies, , vol. 4(3), pages 206-229, July.
    12. Nebahat Tokatli, 2003. "Globalization and the Changing Clothing Industry in Turkey," Environment and Planning A, , vol. 35(10), pages 1877-1894, October.
    13. Yoke-Tong Chew & Henry Wai-Chung Yeung, 2001. "The SME Advantage: Adding Local Touch to Foreign Transnational Corporations in Singapore," Regional Studies, Taylor & Francis Journals, vol. 35(5), pages 431-448.

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