Fascicolo 3/2008 - Rdes.it

20 Wladimir Andreff
A more detailed analysis exhibits that developed market economies have
only few comparative advantages which concentrate on global trade of ‘equipmentintensive’
goods, primarily skis, ski equipment, boats, windsurfs, golf equipment
and table tennis. Emerging countries have a quite significant comparative advantage
in sportswear and footwear, anoraks, balls, rackets, skates and gymnastic equipment,
i.e. on average in ‘trite’ sports goods with a lower value added in production. A
next step would be the analysis of the determinants of these international
specialization patterns, the role of demand and unit production costs, namely the
relationship between labour-intensive sports goods (trite goods) and capital-intensive
and research-intensive sports goods (equipment-intensive goods).
The production of sports goods has globalized although we still lack detailed
knowledge in relation to this and the underlying international economic flows which
triggers this, i.e. the phenomenon of FDI. The breakdown of available data regarding
FDI is not detailed enough to precisely detect foreign investments undertaken in
the sports goods industry. If one wants to assess the role of FDI and MNCs in
globalization of the sports economy, there are two ways which can be followed.
The first way is by observing the rates at which trite sports goods are reexported
back to their home base developed market economies, as well as the reexports
from developing and emerging countries where foreign subsidiaries and
production had been relocated by MNCs. 15 The second means consists of writing
monographs about MNCs involved in sports goods. For instance, Salomon (then
merged into Adidas) or Rossignol (now merged into Quicksilver) had invested
abroad, in North American and European countries in order to supply fast growing
and wealthy domestic markets – the tool here was a so-called horizontal FDI geared
towards consumer demand. On the other hand, firms like Adidas, Puma, Lafuma
and others invested abroad (primarily in Eastern Europe, Maghreb and Asia) in
order to lower their production costs by means of a vertical FDI (diminishing input
costs, for example unit labour costs). Pursuing the same goal, Nike, Reebok, and
Mizuno have adopted a different strategy of production relocation in low-cost
countries without any FDI; they signed international subcontracting arrangements
with Asian producers and, consequently, developed outward processing trade from
emerging countries, in particular in trite sports goods trade. Nike went furthest in
this strategy and became a hollow corporation having no longer any sports goods
production in the US where the firm concentrates on conception, design, marketing,
distribution and financial activities. All Nike sports goods are manufactured by
Asian subcontractors (mainly Indonesian, Pakistani and Chinese) and labeled ‘Nike’
afterwards. More research is needed to go deeper into the analysis of various MNCs
strategies in a globalized sports goods industry.
The market for high-level sporting talents has also globalized. It is a labour
market in which professional players and other highly talented athletes are
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15
See W. ANDREFF, L’internationalisation économique du sport, cit.; W. ANDREFF, International
trade in sports goods, in W. Andreff, S. Szymanski, (eds.), Handbook on the Economics of
Sports, cit., 59-67.