The restructuring of industrial production in recent years has given rise to new geographic patterns of economic activity. There has been a global shift of much productive activity to developing countries. In addition, there is a growing emergence of new flexible forms of industrial organization at local and urban scales. Growing attention has been paid in geography, sociology, economics and other disciplines to both of these processes and, in particular, to their impacts on economic and social structures in developing countries. This project will examine the relationship between these new flexible industrial structures and the range of employment forms accompanying their expansion. Specifically, it explore the extent to which a key example of flexible production, subcontracting, incorporates cheap, off-premises, unprotected labor into manufacturing versus the extent to which it generates secure, skilled employment in supply firms that are interdependent with parent companies. Comparative empirical research conducted in Ecuador will involve in-depth field work to identify systematic relationships between the structure and nature of subcontracting hierarchies and the range of employment forms they generate. The research will generate descriptive analysis employing secondary data to estimate the structure of subcontracting hierarchies across all enterprises in the garment and auto-assembly industries. These activities will be complemented by an analysis of a sample of firms representing each industry to explore the extent of and rationales for subcontracting. Workers in these firms will be interviewed to identify the range of employment arrangements through which workers are incorporated into these subcontracting hierarchies. Through these empirical analyses, theoretical links between distinct types of subcontracting, resultant employment forms, and their welfare implications will be identified. Subcontracting has received growing attention in the development literature. Considerable research has identified distinct types of subcontracting associated with different reasons for their emergence. Past research has also analyzed relationships between employment forms and worker welfare, but little has been done on the connections among these phenomena. This study will advance our understanding of these issues by posing questions about the theoretical linkages between these two previously unconnected bodies of theory. In addition, this project will develop methods designed for comparative empirical work on subcontracting hierarchies, forms, and resultant employment arrangements. The study will provide the rigorous cross-industry comparison called for in previous work, and it will shed light on the organization of industrial production in a less developed setting. The analysis will contribute to our understanding of the differential consequences of subcontracting arrangements for employment relations and the nature of work and their implications for worker welfare. Increased knowledge about this differentiation is essential to further understanding of contemporary industrial restructuring.
