GLOBAL VALUE CHAINS (GVCS) AND ECONOMIC GROWTH: A NONLINEAR ANALYSIS

Zhuqing Mao ()
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Zhuqing Mao: DST/NRF South African Research Chair in Industrial Development, College of Business and Economics, University of Johannesburg, 31 Henley Road, Auckland Park, Johannesburg 2092, South Africa

The Singapore Economic Review (SER), 2022, vol. 67, issue 03, 985-1004

Abstract: This study examines the relationship between economic growth and participation in global value chains (GVCs) and demonstrates that the U-shaped nonlinear pattern of GVCs could be more effective than the simple linear pattern of GVCs in terms of economic growth in high- and middle-income economies. The U-shaped nonlinear pattern expresses that an economy decreases foreign dominated GVCs (increases domestic value chains) for building local value chains and then raises the GVCs participation to benefit at a better position in GVCs. This paper investigates a panel of 63 advanced and emerging economies and obtained significant evidence by using systemic quantitative analysis. This research suggests that emerging markets should decrease foreign-dominated GVCs (increase high value-added domestic value chain) and then raise the participation of the GVC for economic growth.

Keywords: Global value chains; economic growth; nonlinear analysis; quantitative analysis; emerging economies (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1142/S0217590821450028

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