Artificial intelligence as a catalyst for reshaping global value chains in multinational firms

Kaloyan Kolev ()
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Kaloyan Kolev: University of Economics - Varna, Varna, Bulgaria

Izvestia Journal of the Union of Scientists - Varna. Economic Sciences Series, 2025, issue 1, 81-88

Abstract: The study examines the transformative role of Artificial Intelligence (AI) as a general purpose technology in reshaping global value chains (GVCs). By adopting Richard Baldwin’s framework of the "Third unbundling" the article analyzes how AI decouples labor services from physical location, fundamentally altering the geography of production. The research identifies three critical dimensions of impact: the structural reconfiguration of global footprints towards regionalization and resilience; the transformation of governance mechanisms through algorithmic control and digital coordination; and the shift in value distribution, leading to both a "flattening" and "deepening" of the traditional smiling curve. The findings suggest that while AI offers opportunities for emerging economies to upgrade into high-value segments, it simultaneously risks consolidating power among technologically advanced lead firms, creating a complex dynamic of dispersed production and centralized control.

Keywords: Multinational enterprises; Global value chains; Artificial intelligence (search for similar items in EconPapers)
JEL-codes: F23 O33 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:vrn:suvrna:y:2025:i:1:p:81-88

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