scholarly journals Global Value Chain Participation, Competition, and Markups: Evidence from Ethiopian Manufacturing Firms

2021 ◽  
Vol 36 (3) ◽  
pp. 491-517
Author(s):  
Jieun Choi ◽  
Emiko Fukase ◽  
Albert G. Zeufack
Keyword(s):  
Value Chain ◽  
Value Added ◽  
Manufacturing Firms ◽  
Global Value Chain ◽  
Intermediate Inputs ◽  
Horizontal Competition ◽  
Competition Effects ◽  
Backward Linkages ◽  
The Relationship ◽  
Total Sales

This study uses detailed manufacturing census panel data for 2000 to 2014 to explore the relationship between Ethiopian firms’ global value chain (GVC) participation and markups. We find that GVC firms, defined as firms involved in both exporting and importing intermediate inputs, tend to have lower markups relative to non-trading firms and firms that are involved only in material imports. Moreover, the more intensely a firm is integrated into a GVC (measured by the share of export value added and imported inputs in total sales), the lower its markup is. Finally, we explore competition effects at the industry level and find that firms operating in industries with a relatively high GVC presence and suppliers selling inputs to such industries tend to have lower markups owing to horizontal competition and backward linkages, respectively. All of these findings suggest that GVC participation is associated with greater competition for Ethiopian firms.

Global value chain linkages and domestic value-added content: Empirical evidence

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Bhushan Praveen Jangam ◽  
Badri Narayan Rath
Keyword(s):  
Value Chain ◽  
Least Squares Method ◽  
Value Added ◽  
Value Chains ◽  
Global Value Chain ◽  
Content Type ◽  
Services Sector ◽  
The Impact ◽  
The Relationship ◽  
Practical Implications

Purpose This paper aims to examine the relationship between global value chains (GVCs) and domestic value-added content (DVA) in a panel of 58 countries for the period 2005–2015. Design/methodology/approach First, the authors quantify the refined measures of GVC linkages by using the Borin and Mancini (2019) decomposition technique. Second, the authors apply the feasible generalised least squares method to test the relationship between GVCs and DVA empirically. Findings First, the authors find that GVC links are crucial to the enhancement of DVA. Second, a study at the sectoral level reveals that GVC links in the primary sector raise DVA whilst reducing DVA in the services sector. Third, the authors find that only upstream activities enhance value-added content. Fourth, the authors note the augmenting role played by national policies in mediating the gains associated with GVCs. Finally, the authors note that the outcomes associated with GVCs are consistent when the sample of countries is divided into groups based on income. Practical implications The results lead us to urge policymakers to promote greater integration of business activities into GVCs to reap their benefits. Originality/value This paper contributes to the research on the impact of GVCs on DVA by emphasising the significance of the types of GVC activities and policies that improve DVA.

scholarly journals Exchange Rate Risk Analysis Based on Firm Data: A Global Value Chain Perspective

2020 ◽  
Vol 2020 ◽  
pp. 1-12
Author(s):  
Mimi Ning ◽  
Jianhong Qi
Keyword(s):  
Exchange Rate ◽  
Value Chain ◽  
Risk Model ◽  
Exchange Rate Risk ◽  
Global Value Chain ◽  
Rate Risk ◽  
The Exchange Rate ◽  
Firm Data ◽  
Backward Linkages ◽  
The Relationship

This paper investigates whether firms’ participation in the global value chain (GVC) weakens the exchange rate risk and its mechanism. Based on Powers and Riker’s (2013) expanding exchange rate risk model, this paper matches data from China’s refined input-output table, the customs database, and the industrial enterprise database from 2002 to 2009 to measure the firms’ GVC forward linkages and backward linkages and therefore empirically tests the relationship between participation in the GVC and the exchange rate risk. The results show that participation in the GVC reduces firms’ exchange rate risk through a “comovement effect” for forward linkages and a “hedging effect” for backward linkages; differences in a firm’s position in the GVC affect the extent of reduction in the exchange rate risk. Encouraging firms to participate in the GVC and strengthening GVC relationship with high-income countries in particular play an important role in minimizing the exchange rate risk.

Measuring economies’ pivotability on the global value chain under the perspective of inter-country input–output network

2021 ◽  
pp. 2150289
Author(s):  
Lizhi Xing ◽  
Yu Han ◽  
Dawei Wang
Keyword(s):  
Value Chain ◽  
Betweenness Centrality ◽  
Value Added ◽  
The United States ◽  
Global Value Chain ◽  
Input Output ◽  
Trade Disputes ◽  
Industrial Sectors ◽  
Edge Based ◽  
Novel Coronavirus

Under the dual background of trade disputes between China and the United States and the epidemic of 2019 novel coronavirus, the existing Global Value Chain (GVC) division and trading system are facing unprecedented impact. This paper reinforces the present studies on international trade by analyzing the fragments of GVC, which are made of numerous Inter-Country Input–Output (ICIO) relations. We first redefine the inter-country and inter-sector propagating process of intermediate goods, coming up with the concept of Strongest Relevance Path Length (SRPL) based on Revised Floyd–Warshall Algorithm (RFWA). Second, enlightened by betweenness centrality, we introduce Weighted Betweenness Centrality of Edge based on RFWA to measure the Value-Added Pivotability of Input–Output Relations, which brings forth pivotability at domestic, international, and global levels. The results show how much a given country can influence the world economic pattern by linking worldwide upstream and downstream industrial sectors, be it at home or abroad. Also, we can try to explain what is the cause of the phenomenon that the economic influence of nations is trading off and taking turns with all sorts of local or even global evens happening.

scholarly journals Competitive Conditions in Global Value Chain Networks: An Assessment Using Entropy and Network Analysis

Entropy ◽  
2020 ◽  
Vol 22 (10) ◽  
pp. 1068 ◽  
Author(s):  
Georgios Angelidis ◽  
Evangelos Ioannidis ◽  
Georgios Makris ◽  
Ioannis Antoniou ◽  
Nikos Varsakelis
Keyword(s):  
Value Chain ◽  
Value Added ◽  
Value Chains ◽  
Global Value Chain ◽  
Degree Centrality ◽  
Sector Structure ◽  
Input Output ◽  
Weighted Degree ◽  
The World ◽  
Weighted Degree Centrality

We investigated competitive conditions in global value chains (GVCs) for a period of fifteen years (2000–2014), focusing on sector structure, countries’ dominance and diversification. For this purpose, we used data from the World Input–Output Database (WIOD) and examined GVCs as weighted directed networks, where countries are the nodes and value added flows are the edges. We compared the in-and out-weighted degree centralization of the sectoral GVC networks in order to detect the most centralized, on the import or export side, respectively (oligopsonies and oligopolies). Moreover, we examined the in- and out-weighted degree centrality and the in- and out-weight entropy in order to determine whether dominant countries are also diversified. The empirical results reveal that diversification (entropy) and dominance (degree) are not correlated. Dominant countries (rich) become more dominant (richer). Diversification is not conditioned by competitiveness.

scholarly journals PERAN INDONESIA DALAM RANTAI NILAI GLOBAL PRODUK ELEKTRONIK

2018 ◽  
Vol 4 (1) ◽  
pp. 49-70
Author(s):  
Rizki Putri Nurdiati ◽  
Rina Oktaviani ◽  
Sahara Sahara
Keyword(s):  
Economic Growth ◽  
Value Chain ◽  
Value Added ◽  
Global Value Chain ◽  
Global Integration ◽  
Input Output ◽  
Electronic Industry ◽  
Output Analysis ◽  
Input Output Analysis ◽  
Manufacture Sector

Globalization has transformed the structure of industry into global integration of socalled global value chains (GVCs). Some literatures suggest that electronic industry is known as a successful industry in establishing global value chain. Electronic industry is one of leading cluster in driving economic growth in Indonesia. This study aimed to analyze the role of Indonesia in electronic global value chain according to its share towards global electronic industry, linkages, and value added distribution. An input output analysis by using the Asian International Input Output Table 2005 was employed to analyze the share of each country in electronic global value chain, inter-sector linkages, value added, also output and income multiplier. The result showed that Indonesia had low participation in electronic global value chain. Indonesia’s output share was the lowest among all countries which resulted in low valueadded acquisition. Indonesia played the role as the input user from the various sectors. It is suggested that Indonesia electronic manufacture sector should be integrated with the input supplier sectors. Electronic computing equipment sector can be the main priority in enhancing Indonesia electronic manufacture sector since it has the biggest effect to economic growth. Keywords: electronic, global value chain, Indonesia, input output analysis

scholarly journals Trade Agreements and Services Value Chain: The Case of India and Thailand

2016 ◽  
Vol 3 (1) ◽  
pp. 11
Author(s):  
Tanu M. Goyal ◽  
Arpita Mukherjee
Keyword(s):  
Southeast Asia ◽  
Value Chain ◽  
Market Access ◽  
Value Added ◽  
Secondary Data ◽  
Trade Agreement ◽  
Trade Agreements ◽  
Global Value Chain ◽  
Production Networks ◽  
South And Southeast Asia

Services sector is an important component of the world trade and production networks. With the opening up of world economy, the role of services in the global value chain and value added has expanded. Services liberalisation is becoming a crucial component of free trade agreements. This is particularly true for trade agreements between South and Southeast Asia. Given this background, the objective of this paper is to understand the scope of establishing services value chain between two countries in South and Southeast Asia - namely India and Thailand - by integrating the two markets through trade agreement. The analysis is based on secondary data, in-depth interviews with policy makers and stakeholders in India and Thailand and an examination of the existing trade agreements of the two countries. The paper found that the present level of integration between the two markets is low due to the existence of market access barriers and regulatory bottlenecks. The paper makes recommendation on how the two countries can reduce barriers to trade in services, thereby fostering greater integration and leveraging the development of a global value chain.

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