The Internet, Policy & Politics Conferences

Oxford Internet Institute, University of Oxford

Wood, Graham, Lehdonvirta, Barnard, Hjorth: Virtual Production Networks: Fixing Commodification and Disembeddedness

Wood A.J, Graham M, Lehdonvirta V, Barnard H and Hjorth I, Oxford Internet Institute, University of Oxford

The spread of the internet to three and a half billion people has helped to give rise to a diverse range of outsourcing practices. Firms and people can now choose to carve out a diverse range of business processes to non-geographically proximate workers. This raises important questions for economic development. The World Bank estimates that the online outsourcing sector has annual revenues of $4.8 billion in 2016 and by 2020 this will have grown to between $15-$25 billion (Kuek et al., 2015). The Global Production Network (GPN) framework is a powerful tool for analyzing the changing nature of paid work. We, therefore, begin by highlighting the strengths and benefits of the GPN approach. However, we raise a concern that the manner in which embeddedness has been utilized in this paradigm is possibly ill-suited to arenas of virtual production. This is because labor is potentially fragmented and thus commodified to a much greater extent in virtual production (Greene and Joseph, 2015; Lehdonvirta, 2016). In reviewing the GPN literature we find that it has been strangely silent on the commodification of labour and the ‘third wave of marketization’ (Burawoy, 2010). It appears that the GPN literature has missed the centrality of commodification to embeddedness in Polanyi’s (1944) work. Drawing upon the work Polyani and scholars who have followed his approach (Block, 2001; Burawoy, 2010; Harvey, 2014; Kelleberg, 2009; Webster et al., 2008)we demonstrate the value of a more sociological understanding of embeddedness for investigating virtual production. In fact, to fully account for the uniqueness of virtual production we demonstrate that the GPN model requires significant extension and reformulation. This is the aim of this paper and in doing so we develop a new model of ‘Virtual Production Networks’ (VPNs).

At the core of our VPN model is an original account of the distinctive manner in which online outsourcing platforms organize commodify and disembed labor. We conceptually map VPNs providing an original typology and highlight the ways in which online outsourcing platforms are engineered and framed in an effort to disembedded labor from the laws, institutions and norms. Labor is treated as a ‘pure commodity’ in the neo-classical sense and is fragmented so as to detach it from physical, temporal and administrative structures. We go onto show that while VPNs are dismebedded they are not immaterial or operating in some kind of ethereal alternative dimension. Spatio-temporal fixes (Greene and Joseph, 2015; Harvey, 2001; 2003; Jessop, 2014; Silver, 2003) provide an alternative to the existing GPN notion of embeddedness. We elucidate the manner in which disembedded – i.e. highly commodified – virtual production is fixed within regional, nation and local social networks. In fact, these spatio-temporal fixes enable the overcoming of a number of contradictions created by commodification. We conclude by considering the implications this understanding of VPNs has for social upgrading. In order to make the above argument we draw upon in-depth qualitative data and transaction data from the worlds largest online outsourcing platform. Our qualitative data consists of semi-structured interviews with 128 Filipino, Malaysian, Vietnamese, South African, Kenyan, and Nigerian workers and 23 stakeholders.

Wood, Graham, Lehdonvirta, Barnard, Hjorth