The Organization of Global Supply Networks

Loredana Fattorini (), Armando Rungi and Zhen Zhu ()
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Loredana Fattorini: IMT School for Advanced Studies Lucca
Zhen Zhu: IMT School for Advanced Studies Lucca

No 08/2017, Working Papers from IMT School for Advanced Studies Lucca

Abstract: In this contribution, we introduce a network approach for the organization of global production across national borders, beyond the sequential industry-level metrics proposed in the previous literature. First, we show and argue that several characteristics of global production processes would be lost in the analysis when assuming that they could be proxied as linear sequences. Hence, we propose an index that assesses the relevance of any input for the target output, including its role as an input of inputs. Thereafter, we exploit an own-built firm-level dataset of about 20,489 U.S. parent companies integrating more than 154,000 affiliates worldwide. Results show that the technological relevance of an input in a directed supply network is also a good predictor for: i) the probability that an input industry is actually integrated within a firm boundary; ii) the number of affiliates that are controlled by the parent company and active in that input industry.

Keywords: global value chains; supply networks; vertical integration; upstreamness; firm theory (search for similar items in EconPapers)
JEL-codes: D57 F14 F23 L22 L23 (search for similar items in EconPapers)
Pages: 38
Date: 2017-11, Revised 2017-11
New Economics Papers: this item is included in nep-com, nep-int, nep-net and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published in EIC working paper series

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http://eprints.imtlucca.it/3833/1/EIC_WP_8_2017.pdf First version, 2017

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Persistent link: https://EconPapers.repec.org/RePEc:ial:wpaper:8/2017

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