How Living Wages Influence Apparel Costs and Comparative Advantages among Different Multi-tier Supply Chains

How Living Wages Influence Apparel Costs and Comparative Advantages among Different Multi-tier Supply Chains

Year:    2022

Author:    Petchprakai Sirilertsuwan, Sébastien Thomassey, Xianyi Zeng, Yan Chen

Journal of Fiber Bioengineering and Informatics, Vol. 15 (2022), Iss. 1 : pp. 1–15

Abstract

This paper aims to reveal how paying manufacturing workers with living wages instead of minimum wages increases business costs and alters comparative advantages among 98 multi-tier supply chains, as well as to find the level of wage increase to make the lowest cost supply chain lose its competitiveness. Both scenario and sensitivity analyses are employed. The findings show that paying living wages neither significantly increases business costs nor influences comparative advantages of the 98 supply chains, implying no manufacturing relocation and unemployment. Furthermore, the findings present the importance of proximity between materials and product manufacturing locations. Lastly, governments can potentially create their location competitiveness supporting low transportation costs and port fees, and incentivizing materials manufacturing to attract other manufacturing activities.

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Journal Article Details

Publisher Name:    Global Science Press

Language:    English

DOI:    https://doi.org/10.3993/jfbim00377

Journal of Fiber Bioengineering and Informatics, Vol. 15 (2022), Iss. 1 : pp. 1–15

Published online:    2022-01

AMS Subject Headings:   

Copyright:    COPYRIGHT: © Global Science Press

Pages:    15

Keywords:    Global Value Chain

Author Details

Petchprakai Sirilertsuwan

Sébastien Thomassey

Xianyi Zeng

Yan Chen