Global Production Networks is a concept in developmental literature which refers to "the nexus of interconnected functions, operations and transactions through which a specific product or service is produced, distributed and consumed."
In 1990s the concept of value chain gained its credit among economists and business scholars.. The concept combined sequenced and interconnected activities in the process of value creation. Value chain concept focused on business activities, but not on the corporate power and institutional context. In 1994 Garry Gereffi, together with Miguel Korzeniewicz introduced the concept of Global Commodity Chains : The concept was developed further by a number of authors that emphasized importance of chain governance in different commodities At the beginning of 2000s a group of authors Jeffrey Henderson, Peter Dicken, Martin Hess, Neil Coe and Henry Wai-Chung Yeung, introduced GPN framework, that builds on the development of previous approaches to international production processes. At the same time it expands beyond the linearity of GCC approach to incorporate all kinds of network configuration. Adopting clear network perspective allows to embrace the complexity of multidimensional layers of production moving beyond the "linear progression of the product or service"
Insights from the analysis of production networks
Analysis of the global production networks relies on the use of the input-output tables that links firms through the transactions involved in the product creation. Commodity chain literature considers firms as the nodes in a number of chains that transform inputs into outputs through a series of interconnected stages of production, later linked to distribution and consumption activities. Andersen and Christensen define five major types of connective nodes in supply networks: Local integrator, Export base, Import base, International spanner and Global integrator Hobday et al. argue that the core capability of the firms stem from their ability to manage network of components and subsystem suppliers. To capture both vertical and horizontal links across the sequence of production process, Lazzarini introduced the concept of Netchain: "a set of networks horizontal ties between firms within a particular industry or group, which are sequentially arranged based on vertical ties between firms in different layers... Netchain analysis explicitly differentiates between horizontal and vertical ties, mapping how agents in each layer are related to each other and to agents in other layers". Critical studies have explored production networks in the domain of ethics of production, for instance focusing on local effects or labor relations.
