Linking into Global Value Chains Is Not Sufficient: Do You Export Domestic Value Added Contents?

Abstract

This paper compares alternative ways of measuring participation of a country in Global Value Chains (GVCs) and estimates distribution of gains among countries in terms of countries' shares in total value-added created by trade under GVCs. Using the OECD-WTO database on Trade in Value Added, this paper shows that 67% of total global value created under global value chains, accrue to OECD countries while share of NICs and BRICs countries is 25%. Only 8% of total value added is shared among all other developing countries and Least Developed Countries (LDCs). Linking into Global Value Chains is not enough for taking gains. Policy should be designed to raise forward linkages, that is, exporting domestic value-added contents. Trade-led growth is more complex than it seems.

Gelen Doğrudan Yabancı Sermaye Yatırımları ile Geri Bağ Arasındaki İlişki

“…2015). Uluslararası ticarette geri bağ etkisi ülkelerin ihracattaki yabancı ara mal ithalatını ya da ihracatın ara mal bağımlılığını göstermektedir (Banga, 2014). İleri bağ etkisi ise ihraç edilen ara malın diğer ülkelerin ihracatındaki payını göstermektedir.…”

“…İleri bağ etkisi ise ihraç edilen ara malın diğer ülkelerin ihracatındaki payını göstermektedir. Küresel değer zincirine katılım ileri ya da geri bağ ile gösterilebildiği gibi küresel değer zincirine katılımdan elde edilen faydanın ileri bağ etkisinden geri bağ etkisinden çıkarılması ile elde edilen net katma değer ile de ölçülebilmektedir (Banga, 2014).…”

Modelling of regulatory factor and managerial impact assessment in the regional economy sectors: a case-study of the Kaliningrad region (Russia)

“…Research conducted in Russia and beyond shows that the methodology for creating such models most often hinges on the theory of value chains (Porter, 2005). At present, researchers lean towards global value chains (e.g., Amador & Cabral, 2016;Banga, 2014;Cattaneo, Gereffi, & Staritz, 2010;Ju & Yu, 2015;Kaplinsky & Morris, 2003;Kaplinsky, Terheggen, & Tijaja, 2011;Kwon & Ryou, 2015;Mayer, Phillips, & Posthuma, 2017;WTO, 2013); the current methodology gravitates to the analysis of input-output tables (e.g., Lenzen, Moran, & Kanemoto, 2013;Los, Timmer, & de Vries, 2015;Suder, Liesch, Inomata, Mihailova, & Meng, 2015).…”

Global Value Chains and Deep Preferential Trade Agreements: Promoting Trade at the Cost of Domestic Policy Autonomy?

“…5 This is significant, as value-added trade makes up an important part of developing countries' GDP: 28% compared with 18% in developed countries in 2010 (UNCTAD 2013b). Using the OECD/WTO TiVA data, Banga (2014) estimates that of total value generated under GVCs, OECD countries contribute 67%, the BRICs and newly industrialised countries 6 25%, and the remaining developing economies and least-developed countries (LDCs) only 8%. In sum, OECD countries still contribute the lion's share and the increase in non-OECD shares can to a large extent be traced back to emerging economies.…”

“…However, what ultimately matters is not only participation in GVCs, but the extent of value created in the export-related economy that effectively contributes to domestic job creation and growth (Banga 2014). Concerns are voiced that the share of domestic value added in exports is often limited in developing countries that specialise and remain trapped in low segments of the value chain or that rely on high proportions of imported content (UNCTAD 2013d).…”