Global value chains and domestic innovation

Keiko Ito, Kenta Ikeuchi, Chiara Criscuolo, Jonathan Timmis and Antonin Bergeaud

Research Policy, 2023, vol. 52, issue 3

Abstract: This paper explores how changes in both position and participation in Global Value Chain (GVC) networks affect firm innovation. The analysis combines matched patent-firm data for Japan with measures of GVC network centrality and GVC participation using the OECD Inter-Country Input-Output (ICIO) Tables over the period from 1995 to 2011. We find that Japan's position in GVCs has shifted from being at the core of Asian value chains towards the periphery relative to other countries in the network, i.e., becoming less “central”. We use China's accession to the World Trade Organization as an instrumental variable for changes in Japanese centrality. Our analysis shows that increases in Japanese sectors' forward centrality – i.e. as a key supplier - tend to be positively associated with increasing firms' patent applications in these sectors and that firms in key hubs within GVCs, specifically as key suppliers, appear to benefit from knowledge spillovers from downstream markets.

Keywords: Network centrality; Global value chains; Patent; Micro data; Japan (search for similar items in EconPapers)
JEL-codes: D24 F14 F61 L25 O33 O53 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Related works:
Working Paper: Global Value Chains and Domestic Innovation (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:52:y:2023:i:3:s0048733322002207

DOI: 10.1016/j.respol.2022.104699

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