The Core of the Apple: Degrees of Monopoly and Dark Value in Global Commodity Chains

Donald A. Clelland

Abstract


The capitalist world-economy takes the form of an iceberg. The most studied part which appears above the surface is supported by a huge underlying structure that is out of sight. Unlike the iceberg, the world-economy is a dynamic system based on flows of value from the underside toward the top. These include drains of surplus (expropriated value) that take two forms: visible monetarized flows of bright value and hidden un(der)costed flows that carry dark value (the unrecorded value of cheap labor, labor reproduction and ecological externalities). Commodity chains are central mechanisms for these surplus drains in the world-economy. At each node of the chain, participants attempt to maximize their capture of bright value through wages, rent and profit. They do this by constructing differential degrees of monopoly (control of the markup between cost and sale price) and degrees of monopsony (control of markdowns of production costs). However, this process depends upon the transformation of dark value into bright value for capture. Via an examination of the Apple iPad commodity chain, I show how the bright value captured by Apple depends on the dark value extracted by its suppliers. Dark value is estimated by measurements of the value of under-payments for wage labor, reproductive labor and environmental damage in Asian countries, especially China. Surprisingly, most dark value embedded in the iPad is captured by final buyers (mostly in the core) as consumer surplus.

Keywords


Apple; Chinese labor; consumer surplus; dark value; monopsony; unequal exchange; value capture

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DOI: https://doi.org/10.5195/jwsr.2014.564

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Copyright (c) 2015 Donald Clelland

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