International Comparative Evidence on Global Value Chains

Abstract

The past decades have witnessed a rapid globalisation of economic activity which has significantly changed the outlook of the world economy. An increasing number of firms, countries and other economic actors take part in today’s global economy and have become increasingly connected across borders. International production, trade and investments are increasingly organised within so-called global value chains (GVCs) where the different stages in the production process are located across different economies. Intermediate inputs like parts and components are produced in one country and then exported to other countries for further production and/or assembly in final products.

This functional and spatial fragmentation within GVCs is significantly affecting how the global economy operates and has increased the economic interdependency between economies. The increasing importance of intermediates clearly suggests that economies no longer rely only on domestic resources to produce goods and services and export these to the rest of world (Sturgeon and Gereffi, 2009). Countries just like firms increasingly become specialised in specific functions within these GVCs.

Keywords: International, Comparative, Evidence, Global Value Chains, Koen De Backer, Norihiko Yamano,OECD

JEL Classification: Z00