Combining established methods for value chain and power analyses: Towards a comprehensive next-generation understanding of value chain governance

Abstract

Methods to analyze power in value chain governance often focus on multinational firms, which may not apply well to natural resource-based chains in domestic markets. Value chain analyses imply the complexity and power imbalances among the (in)direct actors in a value chain. However, quantifying the added value alone cannot fully capture the nuances of power among value chain actors. To cover the methodological gap, we propose complementing value chain analysis with actor-centered power and institutional power frameworks. The appropriation of profit and labor is framed as the key issue area to ensure coherence. Besides mapping the value chain and calculating the added value per value chain actor, the value network is mapped, and the power capabilities of the actors are quantified. The expected output identifies actors’ power in monetary and non-monetary terms, revealing how they utilize (in)formal institutional settings to their (dis)advantage. This multistage mixed-methods methodology permits the derivation of recommendations on how to achieve a more equitable value chain.

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  The methodology consists of three stages: value chain analysis, actor-centered power and institutional power analyses, and synthesis
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  The appropriation of profit and labor are the common issue area in both approaches
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  The paper provides a step-by-step protocol for researchers to collect data