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Covid - 19 has affected global value chains (GVCs) and firms’ behaviours within GVCs to a large extent. Firms need to find flexible solutions to stabilize production and rethink value chain governance and supplier relationships. Thus, GVCs recover from the initial shock, and the GVCs reconfiguration becomes essential for managers. We reviewed recent literature focusing on the GVCs, the role of governance and Covid – 19 effects on it as well as the regionalization trend. Thus, this study aims to give empirical evidence on the reconfiguration of GVCs, particularly the changes in the structure of suppliers in the global apparel industry, by using the Bloomberg Supply Chain Analysis tool in the period of 2017-2021. We analysed the structural changes in selected leading apparel multinational companies’ GVCs - Industria de Diseno Textil, S.A. (Inditex), Hennes &Mauritz AB (H & M) and adidas AG. The findings provide insights on the current state of the theoretically discussed and widely expected regionalization trend in GVCs. The study concludes that two out of three cases provide evidence indicating an ongoing trend toward GVCs regionalization. The contribution of this study consists of empirical evidence of the changes in GVCs supplier structure in the apparel industry in response to pandemic global business environment. Practical implications and recommendations for businesses and policy makers are related to the revealed theories and testable models by using Bloomberg’s Supply Chain Analysis data and linking causes and effects of the GVCs regionalization processes.

Any successful change in an organization requires an appropriate change management method and a process for involved staff and department to accept the change and become engaged in order to achieve its success. It is even more important and difficult to adopt a novel change management method to bring multiple organizations across the business value chain into the change implementation. This research does not focused on change management within a single organization but rather emphasizes a change management method, including an appropriate change framework, well-defined critical success factors (CSFs), and related tools for implementing change in multiple organizations. This article introduces one kind of change management method to support a process change through global value chain (GVC) in multiple organizations, and the method is used in a case study to achieve a successful change. In order to succeed in optimizing GVC performance, this research applies the proposed change management method to the case GVC, to support technical change by obtaining the staff's full commitment and engagement. The achieved results from the case study prove that successful change comes not only through technical solutions implemented in the problem process throughout the GVC but also through strong support and engagement from all organizations and involved staff. The proposed change management method not only helped the case GVC to implement change successfully but also can help the relevant multiple organizations to improve the GVC performance and add value by optimizing their problem process.

From 2018 to 2020, the trade war between the United States and China significantly raised trade barriers between the two largest economies in the world. My dissertation examines the economic consequences of the trade war, focusing on China's retaliation, and takes into account the presence of processing trade and global value chains. Whereas many recent studies have documented the effects of the trade war on the U.S. economy, less is known about the impacts on China. Notably, approximately 40% of Chinese imports are processing imports of intermediate inputs used in export-oriented products—which pay zero tariffs, even during the trade war. In Chapter 1, I provide an overview of the trade war and its background, as well as a summary of efforts to assess its economic impacts. I discuss what we have learned to date from both the U.S. and China's perspective, focusing on three central topics: (i) tariff pass-through and trade elasticity, (ii) trade diversion and the role of global supply chains, and (iii) welfare impacts. I also emphasize the importance of considering processing trade and China's duty-free policy on processing imports empirically and quantitatively. In Chapter 2, I conduct an empirical analysis of the impact of Chinese retaliation on China's import quantities and prices, highlighting the different effects on processing and non-processing trade. I do so by using monthly Chinese customs data from 2017 to 2019. I find significant reductions in non-processing imports from the U.S., whereas there is no significant effect on processing imports. This suggests that China's duty-free policy on processing trade may have served as a built-in mechanism to better protect domestic firms from damage by the trade war through the global value chain channel. In Chapter 3, I build and calibrate a quantitative trade model that incorporates China's duty-free policy on processing imports to quantify the welfare and trade effects of the trade war. The model shows that the duty-free policy reduced China's welfare loss by 44%, and that China's imports and exports would have decreased significantly more if processing imports had not been exempted from the tariffs. These changes primarily affect industries in which processing trade is prevalent, and the model also shows considerable spillover effects on U.S. sectoral outcomes.

There is a considerable amount of discussion over the effect of global value chain (GVC) participation on the increasing levels of income inequality in developed and developing countries. This paper aims to contribute to a better understanding of the interlink between income inequality and GVC participation. For this purpose, a panel data analysis is conducted with recent GVC data from the UNCTAD-Eora database. The results from panel data estimations for a sample of 39 countries over the period 1995–2016 suggest that offshoring has a significant inequality reducing effect for developing economies in the long run. Although the estimation results also indicate that some negative distributional effects of GVC related trade emerge in the short run, these seem to be mainly short run reactions of the economy, which might be offset in the long run through the adjustment of the labor market towards a new long run equilibrium.

Purpose Within the theoretical framework of global value chains (GVCs), much importance has been given to industrial districts (IDs) and their role as localized manufacturing systems. The regionalization of GVC has opened new questions on the location of manufacturing activities and the potential consequences at the ID level. The reshoring phenomenon challenges internationalization processes, changing the configuration in trade dynamics for IDs. This paper aims to investigate which are the main internationalization patterns followed by district small and medium enterprises (SMEs) under the perspective of the regionalization of GVCs. This will help both practitioners and policymakers to better understand internationalization trajectories aimed at sustaining the economic development of district firms and territories. Design/methodology/approach The analysis has been conducted using a survey carried out on 210 ID SMEs in the furniture, mechanics and fashion industries located in Veneto and Friuli Venezia Giulia regions, in northeastern Italy. Moreover, data released from the Italian Customs Agency have been merged to detect the trends of interviewed firms’ internationalization between 2005 and 2019. Findings The results highlight how the geography of internationalization has changed over time, in particular following the regionalization of the GVCs. There are also differences among the industry specializations of IDs. This could be attributable to the strategy pursued by each firm to control the competition both in the domestic market and abroad, also in relation to GVC lead firms’ location strategies. Originality/value This paper applies new data on the analysis of ID SMEs related to international transactions over a long period of time. In doing this, this paper adds new insights to the GVC literature and future policies to be implemented to foster the participation of district firms in the global scenario.

Advancing the literature on global value chains (GVCs), this study investigates the impact of the COVID-19 pandemic on immediate dynamics and long-term changes shaping the evolution of the garment GVC. We use a partially grounded, longitudinal approach to analyze data on seven cases of Bangladeshi garment manufacturers, supplemented by archival data on the garment industry. Based on our analysis, we theorize that the COVID-19 crisis has led to three types of dynamics (temporal, structural, and spatial) that contribute to GVC restructuring. Consistent with the paradox approach, we document two counter-tensions that influence the GVC in the long term: the push to disintegrate (i.e., permanently restructure) and the pull to integrate (i.e., preserve or strengthen the existing structural routines). We conceptualize the ultimate structure of the GVC as the alignment of a new balance of power and new capabilities of the GVC actors. Implications for theory, practice, and policy are discussed.

Copyright © 2022 The Authors. Despite the increasing proliferation of deploying the internet of things (IoT) in the global value chain (GVC), several challenges might lead to a lack of trust among value chain partners, for example, technical challenges (i.e., confidentiality, authenticity, and privacy); and security challenges (i.e., counterfeiting, physical tampering, and data theft). In this study, we argue that blockchain technology (BT), when combined with the IoT ecosystem, will strengthen GVC and enhance value creation and capture among value chain partners. Therefore, we examine the impact of BT combined with the IoT ecosystem and how it can be utilized to enhance value creation and capture among value chain partners. We collected data through an online survey, and 265 U.K. Agri-food retailers completed the survey. Our data were analyzed using structural equation modeling. Our finding reveals that BT enhances GVC by improving IoT scalability, security, and traceability combined with the IoT ecosystem. Moreover, the combination of BT and IoT strengthens GVC and creates more value for value chain partners, which serves as a competitive advantage. Finally, our research outlines the theoretical and practical contribution of combining BT and the IoT ecosystem.

The file attached to this record is the author's final peer reviewed version. The Publisher's final version can be found by following the DOI link. The Non-Traditional Export (NTE) sector promises to be the antidote to Africa’s economic woes in the face of dwindling traditional exports. Adopting the Porters Value Chain Framework (PVCF) and a case study design, we explore how alcoholic beverage companies in the African NTE sector could create value in their upstream, midstream, and downstream value chain activities through effective governance and digitisation. In exploring these intricacies of governance and digitisation within African GVCs, we draw on two major case studies, Diageo South Africa and Kasapreko Ghana Limited. Our study shows that the NTE sector can contribute to both economic and social upgrading activities, contribute to industrialisation and create international competitiveness for African firms. Secondly, GVC governance and digitisation, even though still at its infant stages in Africa, has the potential in propelling economic value through the NTE sector.

Questions: Why are we interested in the question of MSMEs and cyber readiness? Linking it to the SME Programme at ITU (Rahul) and WTO MSME Informal Working Group (Kathryn) Evolution of the digital economy and how digital trade has evolved over the past 10-20 years (literature review, see UNCTAD and OECD) What is “digital” (review of the many definitions from UN Agencies/OECD etc. and what our papers' focus will be)? What is cyber readiness for MSMEs in this context? (Academic Researcher + Digital SMEs perspectives) Theoretical conceptualisation of Cyber readiness as a formative or reflective latent variable. (to be decided upon literature review) Is cyber readiness the same as business digitalization; how do these concepts differ from digital transformation, digitisation etc.? How do others define it? What definition will we use (it might be a function of what data are available) What cyber readiness is required for international trade participation? What do MNCs require, and what is needed, in terms of cyber readiness in order for MSMEs to participate in GVCs? MSME participation in digital trade and the need for cyber readiness (e.g., cyber readiness can be a determinant of MSME participation in trade (various presentations received on cyber readiness to WTO MSME Group WTO | Informal Working Group on Micro, Small and Medium-sized Enterprises (MSMEs)), either as part of domestic value chains, to participate in e-commerce where digital platforms can facilitate international transactions by firms of any size, or to participate in digital trade including digital services that is an area where MSMEs can excel (for example with born global firms)). Case studies Finalise list of questions to be asked directly to the MSMEs for Questions can be floated via 1-1 interview sessions (recorded) or Microsoft Forms. Data What is a MSME for this paper (most likely number of employees, use OECD definition micro are less than 10 employees, small are 10-49, medium are 50-249, and large are greater than 250 employees) Most likely goods trade from World Bank data with firm size characteristics (answering the question as to whether "cyber ready" MSMEs, or MSMEs in economies that are more cyber ready; trade more. Modelling ITU stats for a digitalization indicator (country and firm levels) World Bank (other?) stats for trade Policy Implications Conclusion

While services are an essential element in the global production, trade and consumption of manufactured goods, limited research has been conducted on the role of services in studies of global value chains (GVCs). Recently, however, an emerging literature on the ‘servicification’ of manufacturing in GVCs has evolved, most of which involves aggregate-level analyses of countries and sectors based on trade statistics. Previous studies have thus failed to explore whether and how local firms in developing countries may capture value and upgrade through their insertion into GVCs as service suppliers. In this paper, we contribute to the literature by analysing the development of an industry supplying wind-turbine services in South Africa. We draw on in-depth fieldwork, including fifty-two interviews and five case studies of firms operating as suppliers of various types of ‘embedded’ services to wind-power projects constructed in South Africa. We show the significant economic value in terms of the employment thereby created and the upgrading pathways of five local service-suppliers in knowledge-intensive and high value-added service activities. Our findings point to the benefit of devoting attention to the role of services in relation to upgrading in GVCs.

This article utilises a GVC analytic framework to analyse the wind energy value chain in South Africa and its impact on localisation of goods and services. Its theoretical contribution highlights governance as dependent on system integration dynamics, with lead firms operating as system integrators. The empirical analysis focuses on the interplay between energy and industrial policy showing how policy failure, driven by coal-based vested interests, disrupted system integration and undermined the renewable energy programme. The failure to ensure continuity and predictability of the auction bidding process within energy policy cascaded down the wind energy chain negatively impacting industrial policy attempts to localise domestic and foreign enterprises. This also derived from the South African government failing to prioritise, develop, and embed renewable energy as a green economy strategy within its industrial policy framework. We conclude with the following lessons: (a) GVC dynamics and lead firms cannot be ignored if localisation is to take root; (b) green strategies should be mainstreamed within industrial policy; (c) localisation starts with lead firms encouraging follower sourcing of first tier suppliers; (d) localising domestic value-added services is just as important as developing manufacturing enterprises.

Promoting innovative capabilities in Small and Medium Scale Enterprises (SMEs) is crucial if African countries are to progress in terms of being active in the Global Value Chain (GVC) and achieve i...

Purpose This study aims to integrate social capital theory and the knowledge-based view of firms to develop and test a theoretical framework of the mechanisms that explain the influence of relational governance (RG) on lead-time performance (LTP) of developing-country suppliers in global value chains (GVCs). The authors distinguish between the relational and structural dimensions of RG to explain how they interact to create knowledge and leaning opportunities that transform into performance outcomes. Design/methodology/approach Hypotheses were tested using data collected from a sample of 321 Bangladeshi suppliers embedded in apparel GVCs by using structural equation modeling. Findings RG creates knowledge and learning opportunities that transform into LTP. Relationship quality (RQ) is found to contribute positively to knowledge learned (KL) contingent on relationship structure. KL is found to fully mediate the influence of buyer-supplier RQ on LTP of suppliers. Research limitations/implications The dyadic nature of buyer-supplier interactions calls for multisource approaches in measuring buyer-supplier RQ. The authors also recommend future research to test the model in other industries for greater generalizability. Practical implications Developing-country suppliers in low-technology labor-intensive GVCs can improve their LTP by strengthening their capabilities for internalizing external knowledge and developing and maintaining high quality relationships with wide networks of buyers. Originality/value The conceptualization of RG that explicitly distinguishes between the relational and structural dimensions is novel and should inspire future theoretical and empirical research on GVC governance and performance.

During 2000–2019, the autoparts-automobile global value chain (AAGVC) underwent significant structural changes from a number of perspectives: micro, meso, or inter-firm relations, macroeconomic, and territorial shifts. This document will focus on recent trade debates on the “new triangular relationship” between the US–China and Latin America and the Caribbean (LAC), and Mexico, and specifically on trade in the AAGVC during 2000–2019. In addition to the discussion on global value chains (GVCs) and its implications, the document analyses in detail qualitative and quantitative global changes in the AAGVC and specifically in US imports during 2000–2019, highlighting the performance of Mexico and China in trade, tariffs, and transportation costs. Conclusions include a set of future research topics.

This paper offers preliminary evidence of the extent to which global FDI patterns have responded to the sharp increase in trade barriers since 2018, focusing in particular on the impact of new United States tariffs imposed on imports from China. Using detailed project-level data on new greenfield FDI as well as complementary research, this paper tracks the differential changes in FDI across countries and industries most affected by the trade tensions. There is some evidence of diversion to South-East Asia in specific industries, confirming findings of other research, but the aggregate effect on investment in China is limited and the overall effect on investment in South-East Asia is actually negative. A possible explanation lies in the importance of global value chain linkages as key determinants of firms’ investment decisions.

Increasing uncertainty has hindered the development of international trade in recent years. Participating in the global value chain (GVC) has become one way for Chinese export firms to deal with uncertainty and reduce external risks. Based on trade theory with heterogeneous firms, this study constructs a theoretical framework encompassing uncertainty and GVC participation. We find that uncertainty inhibits the export of firms, but GVC participation can alleviate the negative impact of uncertainty, which is verified through empirical analysis. Additionally, mechanism analysis reveals that GVC participation plays a moderating role through product diversity, market diversity, cost-saving effects, and quality-improving effects. This study demonstrates that in the absence of serious adverse events, GVC is highly efficient. Accordingly, China should actively participate in the governance of the COVID-19 pandemic, reduce the external uncertainty faced by Chinese export firms, promote the return of an efficient GVC, and further ameliorate the negative impact of uncertainty.

Global value changes continued to expand until the late 2000s. On the other hand, regional value chains have formed around major regional hubs due to the expansion of domestic demand in emerging economies, such as China, and strengthened trade protectionism since the global financial crisis. Such changes lead to the reorganisation of value chains, focusing on domestic markets (reshoring) or neighbouring countries (nearshoring). In particular, the importance of supply chain risk management has been highlighted following disruptions to the supply network due to the COVID-19 outbreak in December 2019. In this regard, major countries such as the USA and the EU are rapidly shifting to regional value chains for stable and sustainable production, rather than primarily aiming for production efficiency targeted at reducing costs. Industries in particular are more exposed to such supply chain risks under the existing structure and it now has become extremely important for businesses to take reaction to such risks. This is especially important for major industries in a country such as automobile or semiconductor manufacturing industries in South Korea. The aim of this study, therefore, is to establish the basis for the simultaneous growth of ports and linked industries by examining the existing structure of the global value chain for the automotive industry, which has a strong presence in South Korea’s domestic economy. In this regard, this research carries out a supply chain analysis focusing on the imports and exports of automotive parts. It also analyses the current structural risks and suggests risk management measures to secure a stable supply chain. © 2021 Jungseok Research Institute of International Logistics and Trade.

The general objective of this paper is to evaluate the effects of Global Value Chain Participation (GVCP) on Current Account Balance (CAB) in African countries. The specific objectives are to (1) identify the type of GVCP that contributes more significantly and positively to African countries’ current account balance and (2) find out whether being landlocked affects a country’s participation in global value chain in Africa. This paper uses panel data from three secondary sources: (1) UNCTAD-EORA database (2018) for forward and backward participation indicators, (2) WDI (2018) for current account balance, FDI, population and trade openness and (3) PWT 9.1 for exchange rates. In a linear panel specification, this research applies the Feasible Generalized Least Square (FGLS) econometric techniques and results highlight firstly that forward GVCP contributes more significantly and positively to CAB in Africa with a coefficient ranging between 1.64 and 2.43 in various regressions. Secondly, the effect of GVCP on CAB is reduced in landlocked African countries as revealed in its negative and significant coefficient of -2.33 as the variables are interacted. This paper recommends that, African countries should embark on forward participation and improve connectivity infrastructure to facilitate the participation of landlocked African economies in global interactions.

This study uses detailed manufacturing census panel data for 2000 to 2014 to explore the relationship between Ethiopian firms’ global value chain (GVC) participation and markups. We find that GVC firms, defined as firms involved in both exporting and importing intermediate inputs, tend to have lower markups relative to non-trading firms and firms that are involved only in material imports. Moreover, the more intensely a firm is integrated into a GVC (measured by the share of export value added and imported inputs in total sales), the lower its markup is. Finally, we explore competition effects at the industry level and find that firms operating in industries with a relatively high GVC presence and suppliers selling inputs to such industries tend to have lower markups owing to horizontal competition and backward linkages, respectively. All of these findings suggest that GVC participation is associated with greater competition for Ethiopian firms.

PurposeGlobal value chains (GVC) incorporate internationally fragmented sources of knowledge so as to increase global competitiveness and performance. This paper sheds light on the role of Industry 4.0 technological capabilities in facilitating knowledge access from international linkages and improving firm productivity.Design/methodology/approachDrawing on organizational learning research, the present study argues that the relationship between GVC breadth, analyzed in respect to the geographical fragmentation of production facilities and productivity follows an inverted U-shaped pattern that can be explained by the interplay between external knowledge access and the coordination costs associated with GVC breadth. We test our predictions using a purpose-built survey that was carried out among a sample of 426 Spanish manufacturing firms.FindingsOur results indicate that organizations adhering to a traditional manufacturing system are able to benefit from fewer transnational relationships (concretely 11 foreign facilities) in the search for productivity improvements. This can be largely attributed to the marginal value of the knowledge accessed and the costs of coordinating international counterparts' production and knowledge transfer. However, our study reveals that the adoption of Industry 4.0 technologies has the potential to broaden optimal GVC breadth, in terms of the number of linkages to interrelate with (concretely 131 foreign facilities) so as to obtain productivity gains while mitigating the complexities associated with coordination.Originality/valueThe study unveils that Industry 4.0 technologies enable management of broader GVC breadth, facilitating knowledge access and counteracting coordination costs from international counterparts.

The rapid development of the labor division system of the global value chain not only improves the technological level of developing countries but also creates opportunities for developed countries that dominate the global value chain to transfer pollution-intensive production links to developing countries. When faced with the pressure of environmental governance, the production efficiency of enterprises in the value chain may change significantly. Therefore, this study establishes a global value chain analysis framework, considering environmental factors, that is, the global environmental value chain (GEVC). It discusses the impact of the embeddedness of enterprises in the GEVC on their production efficiencies. Based on the consolidated data from 2000 to 2006 in the China Industry Business Performance Data and the China customs database, the following conclusion is drawn: The embeddedness of enterprises in the GEVC reduces the production efficiency of enterprises, but the changes of production efficiencies of enterprises with different profitability in the GEVC are significantly different. Specifically, the embeddedness of enterprises with positive earnings in the GEVC can improve production efficiency, while that of enterprises with negative earnings in the GEVC will reduce production efficiency. Furthermore, the learning effect and the competition effect reinforce the positive effect of GEVC on enterprise production efficiency, while the "capture effect" weakens this effect, and the scale effect is insignificant. Moreover, foreign-funded enterprises benefit more from the improvement of production efficiency that resulted from GEVC embeddedness.

Moving up the global value chain requires an enabling innovation ecosystem alongside economy-specific endowments, a mix of supportive policies in broad areas of infrastructure and institutions, and other enabling factors. Examining sample economies globally and in developing Asia, the empirical results suggest that during the transition from a low level of upgrading in a global value chain to a medium-level one, efforts should focus on increasing the scale of innovation inputs, allowing firms to improve in many areas of their capacity to innovate. To move higher up a global value chain, the design of innovation policies should gradually emphasize the production of technological, knowledge, and creative outputs.

Global value chain (GVC) participation has transformed many lines of business. The benefits it provides in terms of greater specialization and technology diffusion, however, do not spread identically across countries and industries. This paper shows that taking into account the functional specialization helps to explain how the benefits of GVC participation are distributed. Using data for 35 industries in 40 countries in 2000-2011, we estimate the impact of GVC participation on value added within a production function framework. The results indicate that there is heterogeneity in the effects of GVC participation, according to the functional specialization of the respective industry and its GVC partners. Participating in R&D-related GVCs is especially profitable for fabrication-oriented industries and low-developed countries. It follows that any GVC participation analysis will be incomplete if it fails to take the functional specialization of the GVC participants into consideration.

Este artículo estudia el desempeño comercial de los 12 principales países exportadores de bienes industriales en el periodo 2004-2013, analizando tanto la pretendida asociación existente entre la productividad laboral y la competitividad externa, como el rol de las industrias altamente tecnológicas en el éxito exportador. La aplicación de la metodología de Wang, Wei, y Zhu (2018), a partir del uso de matrices insumo-producto globales, para el caso del comercio de E.U y China, muestra el mejor posicionamiento de E.U en CGV y ejemplifica la relevancia de las nuevas dinámicas productiva globales para la evaluación del comercio internacional a nivel sectorial.

Firms actively participate in the production of the global value chain (GVC), which is an important driving force for economic development. Using a difference‐in‐difference method, our research shows that industries that are relatively more human‐capital intensive experienced a larger GVC position upgrading after 2003 than they had in prior years. Second, mechanism analysis shows that human capital expansion increases firms’ GVC position not only through an imported intermediate input effect but also through an innovation effect. Third, this study shows that increases in the college‐educated labor force have a heterogeneous effect on a firm's GVC position across firms’ various characteristics. Human capital expansion has the largest positive effect on state‐owned firms relative to foreign and domestic private firms. Human capital expansion has also significantly improved the GVC position of firms located in China's eastern and central regions. The findings of this study indicate that it helps upgrading the GVC position of Chinese firms.

Global value chains (GVCs) have become the dominant form of industrial organization in the global economy. Although the economic outcomes of GVC restructuring have been measured and the determinants theorized, there is a lack of empirical research on the real processes of GVC restructuring and its impact on labour in the Global North. This article helps to address this gap by investigating the effect of the participation in GVCs on the lead firms’ value-capturing strategies and on workers’ ability to defend and improve their working conditions in the Swiss machinery industry. Based on a critical GVC approach and a qualitative study of two work conflicts, the study demonstrates how GVCs shape a variety of new strategies for capital and labour; enhancing forms of management strategies and weakening the possibilities for workers’ counterstrategies by eroding collectivism and solidarity and promoting individualism among workers.

Funding: SCP4SCP (Sweden Collaborating with the Philippines for Global Sustainable Consumption and Production) project - Formas (Swedish Research Council for Sustainable Development) [2021-02692]; Swedish Research Council Formas

PurposeUnder the global value chain (GVC) approach, this paper aims to analyze how domestic suppliers on the periphery of the automotive industry are affected by their relationship with foreign multinationals.Design/methodology/approachA case study with primary data collected from foreign multinationals operating in the Mexican automotive industry was used to analyze their relationship with domestic suppliers.FindingsThe evolution of the suppliers has been characterized by improved quality and added value in their products and more asset-intensive, efficient processes. This evolution has been driven by improvement in production capabilities and investment in new equipment by domestic suppliers and facilitated by knowledge transfer from foreign multinationals. However, it has not involved the acquisition of innovation capabilities or the internationalization of production activities. This has limited their position on the first levels of the value chain and their global presence, which are essential aspects when climbing the industry value chain to lead some activities at a global level. At the same time, most of these suppliers have become strategic and have a greater dependence on foreign multinationals. This poses a dilemma for domestic firms, as the relationship with these multinationals becomes more intense and dependent and at the same time reduces the possibility of leading activities in the value chain.Originality/valueThe paper analyzes the impact on domestic suppliers of their relationships with foreign multinationals, integrating traditional product, process and functional upgrading and new elements, in particular, participation in the GVC and dependence on multinationals.

This article provides an overview of India’s participation in global value chains (GVCs). Using multiple databases at the aggregate and industry levels, this article documents the trends in GVC participation of India during the last three decades. Authors further differentiate between India’s backward and forward integration at the country level before evaluating the industry-specific dynamics of GVCs in India. In this study, authors also shed light upon the rising servicification of Indian manufacturing, and highlight the importance of services’ value addition in promoting GVC integration of India. JEL Codes: F1, F15, D57

We estimate the effects of tariff reduction by regional comprehensive economic partnership (RCEP) on global value chains based on simulation. We find that tariff reduction by RCEP has an effect of ...

This paper investigates the determinants of total factor productivity and income growth by taking into account both the position of the industry in the global value chain and the complexity of participation for the period of 1996–2009 for 40 developed and developing countries. Our estimation results clearly show that while all measures of forward GVC participations raise the total factor productivity growth of manufacturing industries, there is no effect of participation into GVCs on the productivity of services sectors. Almost all measures of backward and forward GVC substantially promote the output growth of manufacturing and services industries. These significant results provide strong evidence for the learning by trading hypothesis and indicate the importance of deeper involvement into GVCs for higher sectoral productivity. Substantial evidence for the positive impact of importing and exporting intermediates, participating in GVCs, on sectoral performance imply that the successes of industries highly depend on their efficient integration in the global production process.

La sostenibilidad tiene tres principios rectores: integridad ambiental, equidad social y prosperidad económica que se integran en el marco de triple bottom line. Ser sostenible implica integrar prácticas ambientales, sociales y económicas en los procesos de la cadena global de valor. La presente investigación tuvo como objetivo analizar las prácticas sostenibles y los impulsores de implementación en la industria del arándano azul. Se utilizó como estudio de caso la cadena global de valor del arándano entre México y China. Se recopiló información a través de entrevistas semiestructuradas, visitas a campo y fuentes de información secundaria. El análisis permitió identificar la existencia de tres tipos de impulsores para la implementación de prácticas sostenibles: el gobierno, los consumidores y las organizaciones no gubernamentales. Además, se identificaron el uso de genética y tecnología como práctica ambiental, el cumplimiento de leyes laborales como práctica social y el control del costo-calidad como práctica económica. Y se determinó que las certificaciones son usadas como herramienta de comprobación. Se concluyó que la cadena global de valor del arándano entre México y China, sigue presiones de mercado y prácticas de tipo económico, pero trabaja en iniciativas para mejorar sus prácticas ambientales y sociales.

Transformasi Hijau dan Implikasinya terhadap Daya Saing BerkelanjutanAbstractThis paper examines the linkage of green transformation and competitive advantage at the global level using constant market share and global value chain analysis. Constant market share analysis is used to measure a country’s trade contribution by comparing a country’s export growth with world export growth. Global value chain analysis is also employed to strengthen the constant market share analysis by looking at the role of green transformation in boosting the Indonesian competitiveness in the global supply chain. To achieve the objective of this study, data was collected from secondary sources such as the United Nations Comtrade Database and Asian Development Bank multi-regional input-output (ADB MRIO) for the period of 2000-2018. Constant market share analysis shows that dirty manufactured products from Indonesia can no longer be relied on to compete in the US and European markets due to the increasingly stringent environmental standards and regulations in those countries. Meanwhile, global value chain analysis finds that the clean manufacturing industry has higher competitiveness than the gross manufacturing industry at the global market level. For this reason, this study concludes that the future of Indonesia's manufacturing industry to compete at the global level is in the hand of the clean manufacturing industry.Keywords: green transformation; competitiveness; environmental regulation; constant market share analysis; global value chain analysisJEL Classification: F14, F18, Q56

The integration of China’s sporting goods industry into the global value chain (GVC) has brought opportunities for the development of the industry. However, the both-ends-abroad OEM production mode is "locked" in the low value-added processing and production link in the GVC, which is located at the lowest end of the GVC. When international financial crisis breaks out, the orders of domestic OEM companies decrease significantly, which directly affects the development of the companies. Thus, it indicates that China's sporting goods OEM companies should not rely too much on international processing and export trade, but to rely on the local market to build a national value chain (NVC), integrate domestic and foreign sellers and suppliers and form an orderly product competition and certain market share ability through corporate mergers and acquisitions, product outsourcing, etc. Through the leverage of NVC, leading companies can achieve the expansion of the competitive advantages. Cultivate domestic multinational companies that can compete with international multinational companies in NVC, so that they can focus on the governance and control of the core links of the value chain, realize independent product research and development, brand and sales channel construction, support and help small and medium-sized domestic enterprises take the path of professional development in NVC, actively guide and encourage cooperation with the core to create value chain advantages, and achieve win-win cooperation and products’ functional upgrade.

By using methods of literature, comparative analysis and logic analysis, this paper studies the obstacles and constraints faced by the value chain leaders in the process of functional upgrading of China's sporting goods manufacturing industry cluster under the global value chain environment. The upgrading practice of foreign industrial clusters shows that domestic enterprises can rely on the familiar local market and cultural background to form a strong national value chain (NVC), occupy the high-end links of the value chain, have domestic well-known brands, sales channels and other high-end links in the value chain, and then develop and spread gradually, occupy foreign markets with similar demand, establish a national value chain dominated by local companies as the "chain master", and finally, enter the European and American markets to establish a balanced value chain parallel to the dominance of international giants such as ADIDAS and NIKE, break through the status of being "captured" and "squeezed", and realize product functional upgrades.

Purpose This paper aims to examine the relationship between global value chains (GVCs) and domestic value-added content (DVA) in a panel of 58 countries for the period 2005–2015. Design/methodology/approach First, the authors quantify the refined measures of GVC linkages by using the Borin and Mancini (2019) decomposition technique. Second, the authors apply the feasible generalised least squares method to test the relationship between GVCs and DVA empirically. Findings First, the authors find that GVC links are crucial to the enhancement of DVA. Second, a study at the sectoral level reveals that GVC links in the primary sector raise DVA whilst reducing DVA in the services sector. Third, the authors find that only upstream activities enhance value-added content. Fourth, the authors note the augmenting role played by national policies in mediating the gains associated with GVCs. Finally, the authors note that the outcomes associated with GVCs are consistent when the sample of countries is divided into groups based on income. Practical implications The results lead us to urge policymakers to promote greater integration of business activities into GVCs to reap their benefits. Originality/value This paper contributes to the research on the impact of GVCs on DVA by emphasising the significance of the types of GVC activities and policies that improve DVA.

A new era began with the Industrial Revolution 4.0 which was marked by digitalization and automation activities has changed the work pattern of the economy globally. Especially with the excitement of the spread of the corona virus which has rocked the world economy since the end of 2019 and peaked in 2020. The impact is not only on large companies, but also on MSMEs. The purpose of this study is to analyze the factors that influence the readiness of MSME management in Surabaya to face competition in the new era (industrial revolution era 4.0 and new normal. The influencing factors are reflected in the Global Value Chain (GVC) through business scale, productivity, access to finance / financial resources, IT application, HR competencies, owner's education level, and innovation ability. Furthermore, this research will analyze the factors that can trigger or hinder the readiness of MSMEs in facing 4.0 era This research uses quantitative methods. Researchers distributed questionnaires to 100 correspondents, namely MSMEs in Surabaya. Linear Regression Analysis of SPSS 21.0 statistical software packages used in the model and hypothesis testing in this study. The conclusion of this study is that productivity, access to finance / financial resources, IT application, HR Competency, Education Level, and Innovation ability affect the readiness of SME Management in Surabaya in the face of the industrial revolution era 4.0, while Business Scale does not affect the readiness of SME Management in Surabaya in the face of the industrial revolution era 4.0

This perspective article highlights some major implications of the recent pandemic (Covid-19) on global value chains (GVCs) and how the pandemic can accelerate the adoption of digital and Industry 4.0 technologies in GVCs, with attention paid to multinational enterprises and small-medium enterprises. Particularly, it discusses the potential value of digital technologies in enhancing GVC resilience for better mitigation of disruptions caused by future global shocks. It also proposes useful avenues for future policy considerations to support and direct deployment of digital technologies across key stakeholders in GVCs.

Perdebatan tentang pelemahan hubungan antara nilai tukar dan ekspor telah meningkat dalam beberapa tahun terakhir, dan meningkatnya tren perdagangan terkait rantai nilai global (Global Value Chain/GVC) diasumsikan menjadi sumber melemahnya hubungan di antara keduanya. Dengan menggunakan data spesifik industri manufaktur, studi ini bertujuan untuk menyelidiki dampak GVC pada hubungan Nilai Tukar Efektif Riil (Real Effective Exchange Rate/REER) dan ekspor di empat negara ASEAN. Estimasi dilakukan menggunakan regresi Least Square Dummy Variable (LSDV) untuk periode sampel dari tahun 2009 hingga 2015. Hasil penelitian ini menunjukkan bahwa di Filipina, koefisien elastisitas nilai tukar ekspor dan partisipasi ke GVC tidak signifikan secara statistik. Sebaliknya di Indonesia dan Malaysia, secara rata-rata, integrasi ke GVC dengan berbagai pengukuran akan menurunkan elastisitas ekspor terhadap perubahan REER sekitar 70% sampai 89%. Lebih lanjut, estimasi terhadap data Thailand dan kelompok empat negara ASEAN menunjukkan bahwa partisipasi pada GVC mengubah nilai dan tanda elastisitas ekspor terhadap REER. Kata Kunci: Ekspor, Nilai Tukar, Rantai Nilai Global Abstract The debate on the issue of the disconnected relationship between exchange rates and exports has risen in recent years, with the growing trend of Global Value Chain (GVC)-related trade assumed to be the source of the weakening link between them. By employing manufacturing industry-specific data, this study aims to investigate the impact of GVC on the nexus of the Real Effective Exchange Rate (REER) and exports in four ASEAN countries. The estimations are conducted using Least Square Dummy Variable (LSDV) regression for the sample period from 2009 to 2015. The findings of this study suggest that for the Philippines, the coefficients of exchange rate elasticity of export and participation to GVC are not statistically significant. Conversely, in the case of Indonesia and Malaysia, integration to GVC, with various measurements, will reduce the REER elasticity of exports by around 70% to 89% on average. Furthermore, the estimation data on Thailand and a group of four countries implies that the presence of GVC changes both the value and the sign of REER elasticity of exports. Keywords: Export, Exchange Rates, Global Value Chain JEL Classification: F14, F15, F31

Scholarly interest in global value chain (GVC) has gained momentum in recent years, yet a comprehensive framework that elucidates how GVC affects an important firm-level outcome—innovation performance (IP)—is so far elusive. To address this gap, we develop a conceptual framework related to three diversities (activity, governance structure, and partner location) that lead firms in GVC utilize in order to enhance IP. We draw upon the GVC and social capital research to develop the framework. We propose that the three diversities (collectively termed as triversity) have the potential to affect lead firms’ IP positively as well as negatively. We further propose that mechanisms related to the three dimensions of social capital (relational, cognitive, and structural) help augment the positive effects and mitigate the negative effects of triversity on IP. This article contributes to the understanding of the relationship between GVC triversity, IP, and social mechanism.

The paper, based on the global value chain theory, this paper studies the sustainable development of China's sports shoes manufacturing industry cluster from the perspective of driving force. First, this paper reviews the relevant theories of global value chain. Then it studies the upgrading mode of sports shoes manufacturing enterprise cluster in China under the theoretical framework of global value chain. After theoretical analysis and empirical study, this paper puts forward the idea of upgrading the sports shoes manufacturing enterprise cluster in China. And finally, corresponding suggestions and countermeasures are put forward to provide a basis for the development of industrial clusters and the formulation of policies from the two dimensions of local and global.

This paper constructs a large-scale computable general equilibrium model with 26 countries and regions. The model is embedded in the global value chain, trade costs are introduced, and the trade ef...

This paper documents the importance of trade in services for global value chain participation in the ASEAN region. Using newly created data on GVCs as well as a new database on the services trade r...

This paper tries to examine how the COVID‐19 shock affects different countries through their regional integration and their exposure to Global Value Chains (GVCs). Using input‐output tables (EORA 2016), our contribution is threefold. First, building on Pahl et al. (2021), we conceptually revise the approaches to analyse input‐output relationships. We underline the difference between the bilateral flow of value added and trade and distinguish between the producers and consumers of value‐added. Second, we distinguish between the supply and demand channels through which these countries can be affected by the disruptions in GVCs. Third, we apply this empirical exercise on an understudied region, namely, the Mediterranean region that is characterized by its involvement in several trade agreements that might boost their integration into GVCs. Our main findings show that, first, most of the countries have relatively larger backward GVC linkages than forward ones. Second, in the Northern shore of the Mediterranean, Italy and France are net suppliers of value added since they produce more value‐added absorbed abroad than the foreign value‐added they consume. Third, our results highlight also the limited integration between Southern shore partners, whose integration is almost completely driven by linkages with Southern European developed countries.

We analyse the value‐added creation effect of global value chain (GVC) participation activities of APEC member economies, using a fixed‐effects regression model analysis based on country–industry data from Organisation for Economic Co‐operation and Development (OECD) Inter‐country Input–Output Tables. We find that forward participation in GVCs is more desirable than backward participation for creating domestic value‐added and that the industry position in the middle stages of the production line creates higher domestic value‐added per output unit. These results hold regardless of the application of standard Ordinary Least Squares (OLS) or fractional logit for panel data and of the characteristics of the interconnected countries in GVCs (APEC member vs. non‐APEC member economies, Asian APEC vs. non‐Asian APEC members, developed vs. developing countries). This implies that the conventional firm‐ or product‐specific U‐shaped ‘smile curve hypothesis’ is not applicable at the economy‐wide, country–industry level. This finding suggests that depending on the product type, manufacturing industries can be a major driving force for less‐developed APEC member economies to climb the development ladder. Since GVC participation gains are diversified across industries and upgrading country–industry positions in GVCs are challenging for APEC member economies, we strongly recommend that they construct effective domestic value chains and coordinate with other members while upgrading their GVC participation.

The corona virus outbreak, which originated in China, has infected nearly 8, 75,000 people. Its spread has left businesses around the world counting costs. The corona virus is going global, and it could bring the world economy to a standstill. COVID-19 that began in the depths of China’s Hubei province is spreading rapidly, persuading the World Health Organisation to declare it as a pandemic. There are now significant outbreaks from South Korea to Italy and Iran, from America to Britain. The ongoing spread of the new corona virus has become one of the biggest threats to the global economy and financial markets. Even though, time and again our Indian economists have assured the country that Indian economy stands relatively insulated from the global value chain, but being integrated into world economy, there has to be some impact. This was reflected in the Nifty when the stock market took a great plunge down in last week of February, 2020. The present study is an attempt to examine the impact of COVID-19 on Indian Stock market. The study takes into consideration a time period of four months, from December 1st, 2019 to March 31st, 2020. The study focuses on the Nifty and sectoral indices of Nifty along with India Volatility Index. Tools used for the study involves correlation, regression, ANOVA, variance analysis and moving averages. The study concludes with the statement that volatility is higher in medium run than in short run and also there is significant impact of COVID-19 on Indian stock market.