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Upgrading, Interactive Learning, and Innovation Systems in Value Chain Interventions

The European Journal of Development Research volume 30, pages 557–574 (2018)Cite this article

Abstract

Value chain interventions are increasingly used by donors in the context of private sector development. The paper develops a typology of such interventions, and presents the case of one multilateral lending institution – the Inter-American Development Bank. It argues that interventions risk transforming into an empty label and that an understanding of core global value chain (GVC) concepts, such as power, governance, and rents, is necessary. Further, interventions need to consider different learning channels internal and external to GVCs and particularly the interaction of GVCs with local innovation systems, and the interactive and systemic nature of knowledge and learning. These dimensions have often been overlooked in actual policies and programs. The paper concludes that an improvement in the definition of main concepts and approaches derived from the critical tradition of the GVC literature and of learning and innovation concepts is urgently called for. This reinforces the need for a new generation of industrial policies.

Les interventions sur la chaîne de valeur sont de plus en plus utilisées par les bailleurs de financement pour le développement du secteur privé. L’article développe une typologie de ces interventions et présente le cas d’une institution multilatérale – la Banque Interaméricaine de Développement. Il fait valoir que les interventions risquent de se transformer en une étiquette vide et qu’une compréhension des principaux concepts de la chaîne de valeur mondiale (CVM), comme la puissance, la gouvernance et les revenus, est nécessaire. En outre, les interventions doivent prendre en compte différents canaux d’apprentissage, internes et externes aux CVM, et en particulier l’interaction des CVM avec les systèmes d’innovation locaux et la nature systémique et interactive de la connaissance et l’apprentissage. Ces dimensions ont souvent été négligées dans les programmes et politiques. Le document conclut qu’une amélioration de la définition des principaux concepts et approches, hérités de la tradition critique de la littérature de la CVM et des concepts de l’apprentissage et de l’innovation, s’impose d’urgence. Cela renforce la nécessité d’une nouvelle génération de politiques industrielles.

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Acknowledgements

The authors thank Chris Hooton for his skillful research assistance, and two anonymous referees and the editors of this special issue for their useful comments. Financing for this research was kindly provided by the IDB (RG-T1861). The opinions expressed in this paper are those of the authors and should do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent. Other usual disclaimers also apply.

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Affiliations

  1. Department of Economics, University of Roma Tre, via Silvio D’Amico 77, 00145, Rome, Italy

    Carlo Pietrobelli

  2. UNU-MERIT, Maastricht, The Netherlands

    Carlo Pietrobelli

  3. Austrian Foundation for Development Research (ÖFSE), Sensengasse 3, 1090, Vienna, Austria

    Cornelia Staritz

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  1. Carlo Pietrobelli
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  2. Cornelia Staritz
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Correspondence to Carlo Pietrobelli.

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Pietrobelli, C., Staritz, C. Upgrading, Interactive Learning, and Innovation Systems in Value Chain Interventions. Eur J Dev Res 30, 557–574 (2018). https://doi.org/10.1057/s41287-017-0112-5

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Keywords

  • global value chains
  • private sector development
  • value chain interventions
  • innovation systems
  • interactive learning
  • upgrading

JEL Classification

  • F23
  • O14
  • O25