Global Value Chain Disruptions and Firm Survival During COVID-19: An Empirical Investigation

Sasidaran Gopalan and Ketan Reddy
Additional contact information
Ketan Reddy: Indian Institute of Management Raipur, Raipur, India

No DP-2023-13, Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA)

Abstract: Despite the rapid acceleration of countries participating in global value chains (GVCs) over the last three decades, global GVC participation rates have plateaued since the global financial crisis (GFC) and worsened with the onset of the coronavirus disease (COVID-19) pandemic. Themassive supply chain disruptions induced by the pandemic not only appeared to expose the vulnerabilities of GVCs, largely because of concentration risks, but also contributed to a dramatic decline in trade flows globally. As countries around the world emerge from the shadows of the pandemic, there is growing academic and policy interest in deciphering how countries should build effective strategies that facilitate firm survival, especially viewed from the lens of resilience and robustness. Considering this background, in this paper, we propose to make a twofold contribution to this literature. First, we undertake a comprehensive firm-level investigation (in a cross-country setting) to ascertain whether firms engaged in GVCs relative to non-GVC firms exhibited better survival instincts during the COVID-19 pandemic. Second, we uncover the heterogeneity of the shock across sectors and industries, considering the varied sectoral/industrial exposure to the COVID-19 pandemic. We document that GVC firms showcased greater robustness and resilience during the pandemic phase compared with other firms. Our results also show that the degree of resilience and robustness varies significantly by industry.

Keywords: Global value chains; firm survival; resilience; COVID-19 (search for similar items in EconPapers)
Date: 2023-08-29
New Economics Papers: this item is included in nep-ifn and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.eria.org/uploads/media/discussion-pape ... -During-COVID-19.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:era:wpaper:dp-2023-13

Access Statistics for this paper

More papers in Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA) Contact information at EDIRC.
Bibliographic data for series maintained by Ranti Amelia (ranti.amelia@eria.org this e-mail address is bad, please contact repec@repec.org).