What are 'world market factories?'

According to feminist scholar Diane Elston, these are factories that are producing exclusively for export to rich countries. They are places where, often times, corporations have transplanted their production facilities, in search of cheaper combinations of land, labor and capital.

What are 'free trade zones?'

These are areas deemed to be outside of the customs border and where the valid regulations related to foreign trade and other financial and economic areas are either not applicable, are partly applicable or in which new regulations are tested.
They are designed to increase trade volume (they need inputs … ) and export--they facilitate and enable free trade.

Generally, in free trade zones:

• No duty is ever paid on re-exported merchandise
• If the merchandise is sold domestically, no duty is paid until it leaves the zone or the zones (there are often penalties for domestic consumption. What does this suggest for how factory growth is incorporated into a country's development strategy?)
• Merchandise in a foreign-trade zone may be stored, repackaged, manipulated, manufactured, destroyed or otherwise altered or changed.

With less and less barriers to trade, again facilitated by institutions such as the World Bank and IMF (they have lots of leverage in extending credit lines to other countries), with lowered tariffs, even free trade zones are less common. In essence, larger parts of countries are becoming de facto free trade zones.

Is factory ownership important?

There are three general ownership categories for these factories:

1. They are owned by indigenous capitalists (tough to come up with capital to invest)
2. They are a wholly-owned subsidiary (easy to get capital, control from the multinational's home office)
3. They are a joint venture between a multinational and indigenous capitalists (issue of control is less certain)

What are some advantages and disadvantages of these arrangements?

• Most commonly, companies seek to subcontract with overseas customers (in other words, they don't own the factories--they just contract. Why or how might this be preferable to owning?)
• Multinationals can be even more mobile, or should I say labor and capital are more mobile. For instance, SARS comes along, and a company can pull out of an area more easily, without losing a large amount of investment capital.
• This is less politically sensitive. These companies aren't coming in and buying the country, taking land--they're merely contracting. This is advantageous for the governments, who don't appear to be appropriating citizens' property and auctioning it off to private enterprise. And it is obviously advantageous to the corporation, for reasons stated.

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There are pros and cons to multinational investment vs the development of a class of indigenous entrepreneurs. The multinationals may take their profits elsewhere; the locals may be more likely to re-invest them in the economy. The latter may have difficulty competing, though, with corporations that control various parts of the production process (and may have better access to the inputs they need for production). There is also a process of increasing automation that takes place in some industries (labor can either migrate, or be substituted with capital). There is evidence that the longer a company stays in a country, the more linkages it makes with the local economy--purchasing more of its inputs locally, working with more local producers, suppliers, etc. This can stimulate industry in countries, but remember that it is dependent on the presence of the multinationals' operations. In terms of how employers treat women, multinationals tend to pay higher, and working conditions tend to be better--we would expect they would prefer employment with multinationals over the locals (think of working at WalMart versus a local store trying to compete... ).

As for women, there seems to be little correlation between productivity and wage. Third world women are thus probably one of the most exploited classes of workers, in terms of their high output and low wages. This is capitalism in action, yes, but it's also patriarchy--the women have an inferior, subordinate position in the labor market. However, what if the women working in these factories were doing something else--transplanting rice, or working the informal sector in a sprawling third world city? Women, according to Lim, are better able to leave the household, delay marriage and childbearing, increase incomes, be more mobile, economically autonomous, and essentially have expanded the range of economic choices available to them. It's an interesting paradox--they're better off, no doubt, but still badly exploited. It is a long process for women to move from unskilled labor-intensive positions into those areas requiring management or other professional skills, but it's likely happening in some countries (in many cases, they may be replacing men who've taken higher positions ... ).

Thus according to Lim there are two major forces at work: capitalism, which is inherently exploitative of workers, and patriachy, which provides men with advantages in the labor market. Think of the system of privilege concept. The former will be difficult for governments to address, and the means of addressing it may be different than the latter. Women getting out into the workforce, exploited or no, may be as much of an impetus for social change as movements for greater working conditions, which threaten the capitalistic enterprise and, where labor and capital roam the globe relatively freely, may lead companies to look for other sources of cheap labor in other countries.

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Women's labor and productivity

Managers may make several stereotyped assumptions when hiring women:

• Women are nimble-fingered. Well, actually, these are learned skills, largely as the result of division of labor in households (they can learn other skills, in other words, besides working sewing machines)
• Women are more docile (in a patriarchy . . . with gendered institutions with which they're unfamiliar). Women essentially learn how to be submissive, but it's likely more of a self-preservation instinct when in the company of men than an unthinking behavior.
• Women are more productive than men (this has been shown in a few cases, but division of labor makes comparisons hard)
• Women will work for less-they don't 'need' the job, they're not the breadwinners. WalMart has been sued in U.S. courts when managers have made the same claims (WalMart management is topheavy with males). In fact women are often sent to work by their family, to increase their household's income. That is, even single women are often working for several more people at home.

Women get jobs, yes, the lucky ones. But their working conditions are often poor, they learn few transferrable skills (therefore their value doesn't increase over time and they're easily replaceable), their labor depends on an influx of foreign capital, technology, skills, inputs and markets. This probably doesn't sound like development--it isn't. It's the spread of global capitalism, which often works at odds with development.

How factories gain from employing women:

• They generally pay them lower wages (even when they're working for several others, mothers and daughters)
• the free labor they may provide--some factories require a 'trial period'
• Women a re 'pre-trained' by a lifetime of work (company saves training costs)
• They're often considered easier to lay off--in a patriarchy, they're a 'reserve army' of labor.
• They increase profits, which often leave the country and accrue mostly to foreigners.

Some questions

So . . . Is factory work transforming? For whom? For what institutions?

Does the labor market tend to 'atomize' workers? (they're all individuals, working for individual wages, and can be replaced because of a surplus of unemployed--this is how the capitalist system works).

Do women confront a glass ceiling? They do not often move up in the ranks to management levels.

They benefit yes, if they're employed. But there is considerable instability of employment. This is both the nature of global labor, capital sourcing, as well as employers' power to fire workers for becoming pregnant, being late (more likely with women who might have children, child care needs, transportation problems, etc.).

In a sense, factory labor and the informal sector have a sort of yin/yang dynamic.