This article investigates how distinct tiers of firms contribute to value creation and value capture in the automotive industry. We employ firm-level indicators to evaluate the value creation and capture of distinct supplier tiers in the Czech automotive industry, while considering differences between foreign-owned and domestic firms. Our analysis suggests that the economic effects of the automotive industry largely depend on its capital intensity and that mostly foreign-owned higher tier firms generate and capture greater value than lower tier firms, which include the vast majority of domestic suppliers.
This paper evaluates the influence of the broadly defined automotive industry on regional increases in unemployment in the Czech Republic (Czechia) during the 2008-2009 economic crisis. Drawing on a unique database of 490 firms with 20 or more employees each and a survey of 274 firms, we employ eight indicators to explain changes in the microregional unemployment rate between August 2008 and August 2009. We also introduce and calculate the value creation potential, employment stability potential and regional labour market vulnerability index for each firm and investigate the relationship between a firm's position in the value chain and its propensity to dismiss workers.
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