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How important is GVC participation to export upgrading

Gideon Ndubuisi (ndugideon@gmail.com) and Solomon Owusu

No 2020-026, MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT)

Abstract: Exporting higher-quality and complex products are deemed pathways to economic growth and development. However, producing such products are knowledge-intensive and require quality intermediate inputs and advanced technologies. Integration into global trade networks is increasingly argued to be amongst the pathways to obtain such inputs and technologies, although not all countries may benefit equally from such integration. This paper builds on these arguments and investigates how participation in the global value chain (GVC) affects export-quality. We use a sample of 120 developed and developing countries and find that participation in GVC impacts positively on export quality and, also, brings the export quality of countries closer to the quality frontier, but these effects only work through backward linkages. While this result persists in the sub-sample comprising developing economies, we, however, find that developed countries benefit from both forward and backward linkages in GVC. Overall, the results indicate that GVC participation matters to export upgrading but points to a potential heterogeneity on the channel of impact across countries at different levels of development.

Keywords: Global Value Chains; Quality Products; Export Products; Quality of Exports (search for similar items in EconPapers)
JEL-codes: F00 F01 F14 O10 O24 O25 (search for similar items in EconPapers)
Date: 2020-06-05
New Economics Papers: this item is included in nep-int and nep-tid
References: Add references at CitEc
Citations: View citations in EconPapers (6)

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Journal Article: How important is GVC participation to export upgrading?* (2021) Downloads
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