Clothing-industry Adjustment in Developed Countries

285 Pages·1986·20.44 MB·English

by  José de la Torre (auth.)

Also published for the Trade Policy Research Centre by Palgrave Macmillan
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Clothing-industry
Adjustment in
Developed Countries
BY
Jose de la Torre
Professor of International Business
lnstitut Europien d'Administration des A.ffaires
Fontainebleau, France
M
MACMILLAN
for the
PALGRA VE MACMILLAN
©Trade Policy Research Centre 1984, 1986
Softcover reprint of the hardcover 1st edition 1986 978-0-333-404 71-3
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First published in paperback as Thames Essay No. 38 by The Trade Policy
Research Centre 1985
First published in London by Macmillan 1986
Published by
THE MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG2l 2XS
and London
Companies and representatives
throughout the world
British Library Cataloguing in Publication Data
de la Torre, Jose
Clothing-industry adjustment in developed
countries.
l. Clothing trade
I. Title II. Trade Policy Research Centre
338.4'7687'091722 HD9940.A2
ISBN 978-1-349-08371-8 ISBN 978-1-349-08369-5 (eBook)
DOI 10.1007/978-1-349-08369-5
Contents
LIST OF TABLES Vlll
LIST OF FIGURES XU
BIOGRAPHICAL NOTE Xlll
PREFACE XIV
LIST OF ABBREVIATIONS XXl
1 EVOLUTIONARY STRUGGLE IN WORLD
INDUSTRY 1
Survival Strategies for the Private Firm 2
State Intervention: Resisting Decline or
Assisting Growth? 4
Resisting Adjustment: Pressures for
Protection 6
North-South Interdependence 17
Lessons from the Clothing Industry 19
2
CAUSES AND SYMPTOMS OF DECLINE IN
THE CLOTHING INDUSTRY 22
Pressures for Adjustment 23
Low Growth of Demand 23
Growth of Synthetic Materials 26
Composition of Demand and Distribution 27
v
Potential for Technological Advance 29
Growth of International Trade 32
Decline and Adjustment 40
Shifting Patterns of International Output 40
Employment: the Politically Visible Factor 41
General Decline in Trade Performance 55
Unit Labour Costs as a Measure of
Performance 6 7
Determinants of Employment Losses 71
3 ADJUSTMENT STRATEGIES FOR SUSTAINED
COMPETITIVENESS 78
Elements of an Adjustment Strategy 79
Limits to Technical Development 79
Size and Scale of Individual Companies 84
Wage Adjustment 87
Product and Market Shifts 90
Foreign. Assembly and Sub-contracting 94
Foreign Direct Investment 104
Exit and Diversification 108
Integrated Approach to Survival and
Prosperity 109
Judging Strategies by Performance 109
'Growth' Firms 111
'Struggling' Firms 113
'Comfortably Surviving' Firms 115
Ability to Adjust 11 7
4 GOVERNMENT STRATEGIES FOR EASING
ADJUSTMENT 123
Trade Policy and Protection 124
Quantitative Restrictions on Imports of
Clothing and Textiles 124
Tariffs and Preferences 132
Role of Protection 135
National Adjustment Policies 136
VI
Industrial Policy in the European
Community 136
Belgium: the Claes Plan 146
France: Modernisation Efforts 151
Federal Republic of Germany: an Anomary 157
Itary: Direct State Participation 163
Netherlands: Collapse of Consensus 170
United Kingdom: from Jobs to Investment 177
United States: Protecting a Large Domestic
Market 190
Japan: Positive Aqjustments 198
Lessons of a Decade of Intervention 208
Market-led Industry Adjustment 217
Job Preservation 219
Technological Advance as Industrial Strategy 222
Failure of Restructuring Plans 223
Neo-liberal Approach 224
5 DECLINE, ADJUSTMENT OR RESURGENCE?
THE SHAPE OF THINGS TO COME 236
Private Adjustment Towards the 1990s 237
Issue of Protection 241
Challenge for Public Policy 243
Conclusion 24 7
LIST OF REFERENCES 250
Vll
List of Tables
1.1 A Classification of Public-assistance
Measures to Industry 7
1.2 Import Shares of the Newly
Industrialising and Developing
Countries in Total OECD Imports of
Manufactures 10
1. 3 Exports of Manufactured Goods by 3 7
Developing Countries 15
2 .1 Consumers' Expenditure on Clothing as
a Percentage of Total Private
Consumption (1970 prices) 25
2.2 Changes in Labour Compensation,
Productivity and Unit Labour Costs for
All Manufacturing, 1970-80 30
2. 3 Average Levels of Hourly
Compensation in Manufacturing
Industry 31
2. 4 World Production and Trade m
Textiles and Clothing 33
Vlll
2.5 Major Export Flows in Textile
Products, 1955-70 34
2.6 OECD Trade in Clothing and Other
Textile Products, 1963-80 37
2. 7 Largest World Exporters of Textiles
and Clothing, 1979 39
2.8 Production Indices for Clothing and All
Manufacturing in Selected Countries,
1963-82 42
2.9 Worldwide Production and Employment
in the Clothing Industry, 1963-78/80 44
2.10 Total Employment in the Clothing
Industry for Selected Countries,
1963-80 46
2.11 Regional Concentration of Textile and
Clothing Employment in the European
Community, 1978 51
2 .12 Clothing Exports, Imports and Net
Trade, 1963-80 58
2.13 Trade Specialisation in Clothing 1962,
1969 and 1979 60
2 .14 Trade Performance in the Clothing
Industry, 1963-80 64
2 .15 OECD Trade in Clothing with non-
OECD Countries, 1970 and 1980 66
IX