Comparativists have long demonstrated that corporations are ‘produced’ through a process of national institutional embedding. However, the globalisation of markets is said to be creating global corporations that no longer have allegiance to their home states. They become as global in their outlook as their interests, and take on an increasingly autonomous existence that is both institutionally as well as physically disembedded from their home states.  In fact, they are seen as proactively attacking national institutional variations.  A key reason for this is that most major industry sectors are oligopolistic. Therefore, global corporations have come to control, rather than compete in, global as well as national markets. Freed from the both the ‘shackles’ of market competition and their home states’ institutions, the result produced is said to be a convergence on neoliberal policies, and a ‘race to the bottom’ as states compete to bid down social and environmental protections to serve the interests of highly mobile capital. The impacts are said to be felt universally, though most acutely in the case of institutionally weaker developing states.

Are the interests of global corporations as homogeneous as often claimed, and is the result the neoliberalization of developing states’ political economies? To consider these questions we look at the case of investment in South Africa by Ford and Volkswagen, two of the world’s major automotive corporations. Using insights from the comparative capitalism literature, an analysis of South Africa’s political economy, and a content analysis of these corporations’ reporting, we demonstrate that rather than abandoning the management-labor relations of their home states, these corporations have instead sought to retain them. In fact, they have attempted to reproduce their home states’ institutions in their South African operations. From a corporate perspective, their manufacturing operations in South Africa thus represent a case of proactive rather than passive institutional path dependence. From a South African perspective, the management-labor relations they have sought to establish reflect a process of attempted neo-colonisation, and resistance to it, as much as globalisation. The result is that as global corporations become physically disembedded from their home states when they invest and operate abroad, it does not necessarily follow that they become institutionally disembedded as well. Nor does it follow that the states in which they invest ‘surrender’ their institutional differences. As such, foreign investment is a medium for institutional competition between states, rather than annihilation. 

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How do states’ positions across multiple and interconnected economic networks affect their power? Globalization was not the great equalizer that some either hoped or argued it would be. Instead of becoming flat, the world is in many ways more asymmetrical than ever. As highlighted by the recent literature on weaponized interdependence (WI), many economic activities have indeed become concentrated in a few geographical hubs, creating bottlenecks and chokepoints that some states can use for coercive purposes. To understand how states gain, wield, and maintain power, WI argues we need to consider the topology of global economic networks, along with domestic institutional capacity. Yet, most research in this emerging literature has examined case studies of examples where WI has been used, with support from qualitative data to establish asymmetry. The effect of the topology of global networks on states’ capacity to weaponize economic hubs remains open to debate. In this paper, we start answering this question by looking at how centralities across multiple networks shape state power. We use network methodology to map the semiconductor supply chain and showcase that more than representing one network, it represents multiple interconnected networks. We then highlight how states’ centrality vary across these networks and how it shapes their respective capacities to coerce others. In so doing the paper makes three contributions. First it demonstrates how network analysis can detect potential (ab)uses of WI, enabling analysist to identify both opportunities and vulnerabilities. Second the paper highlights how ‘layers’ of multiple networks interacting with each other help to determine the ability of states to use WI and how centrality in some networks can provide greater influence than others. Last it contributes to other literature which recently used network analysis to analyse structural power on the global stage.

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