Promoting Win/Win Development of Global Value Chains

25 Pages Posted: 24 Feb 2016

See all articles by Susan Helper

Susan Helper

Case Western Reserve University - Department of Economics

Timothy Krueger

Case Western Reserve University - Weatherhead School of Management

Date Written: December 2015

Abstract

In recent decades, networks of financially-independent companies located around the world have come to account for an increasing share of global production. These global value chains operate differently from other models of production, such as the export of finished products made largely in a single country, vertically-integrated multi-national operations, or arm’s-length transactions across national borders. The rise of global value chains has significant implications for policies in areas such as international trade, national development, intellectual property, and international standards in areas such as cybersecurity, treatment of investors, workers, and the environment.

These global value chains offer the potential for complementary growth and development in the firms and nations that participate in them, as well as benefits for consumers. In this view, suppliers locate in nations that have comparative advantages in their particular part of the value chain. Alternatively, global value chains may facilitate a race to the bottom, as multinationals seek suppliers that accept ever-worse terms of trade. A variety of literatures address some, but rarely all, of these issues. Policies affecting value chains are often based on implicit assumptions whose validity has not been robustly tested. This paper will sketch a conceptual framework and identify empirical research needed to identify sources of complementarity and policies that promote innovation and development for workers and firms throughout global supply chains.

Suggested Citation

Helper, Susan and Krueger, Timothy, Promoting Win/Win Development of Global Value Chains (December 2015). Working Paper, East-West Center Workshop on Mega-Regionalism - New Challenges for Trade and Innovation. Available at SSRN: https://ssrn.com/abstract=2745483 or http://dx.doi.org/10.2139/ssrn.2745483

Susan Helper (Contact Author)

Case Western Reserve University - Department of Economics ( email )

Cleveland, OH 44106
United States
216-368-5541 (Phone)
216-368-5542 (Fax)

Timothy Krueger

Case Western Reserve University - Weatherhead School of Management ( email )

10900 Euclid Ave.
Cleveland, OH 44106-7235
United States

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