This research explores how regulations and private governance affect supplier compliance in global value chains.
Analyzed a panel of over 2000 suppliers from emerging economies
Developed a governance framework focusing on labor and environmental compliance
Examined the effectiveness of governance forms on compliance outcomes
In labor compliance, both regulation and private governance increase compliance, driven by stronger MNE sourcing.
In environmental compliance, private governance improves outcomes, but strict regulations reduce MNE sourcing, lowering incentives for suppliers to invest.
Identified a mechanism where regulatory pressures influence MNE sourcing strategies, impacting supplier compliance indirectly.