The Capabilities Driving Participation in Global Value Chains

Vilas Pathikonda () and Thomas Farole
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Vilas Pathikonda: World Bank, 1818 H Street, NW Washington, DC 20433, USA

Journal of International Commerce, Economics and Policy (JICEP), 2017, vol. 08, issue 01, 1-26

Abstract: Global value chains (GVCs) have altered the nature of global trade and offer significant opportunities for developing countries to expand exports, access technology, and raise productivity. Recent literature has pointed to a range of underlying characteristics that may drive participation in GVCs. Using a modified factor-content methodology, this paper shows that proximity to markets, efficient logistics, and strength of institutions are among the most important capabilities. However, the paper also shows that each sector has a unique mix of capability requirements. The paper applies the methodology to Southern African Customs Union countries, and demonstrates that, by filling gaps in underlying capabilities, these countries could increase participation in certain GVC sectors.

Keywords: Global value chains; international trade; comparative advantage; competitiveness; development (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (5)

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Working Paper: The capabilities driving participation in global value chains (2016)
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DOI: 10.1142/S1793993317500065

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