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The effect of GVC embeddedness on productivity improvement: From the perspective of R&D and government subsidy

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  • Ge, Jiali
  • Fu, Yang
  • Xie, Rui
  • Liu, Yu
  • Mo, Wenyang

Abstract

We use the 2000–2007 Chinese firm-level data to measure firms' embeddedness in the global value chain (GVC), and employ the entropy balance (EB) method to investigate the effect of GVC participation on enterprise productivity. The results show that China's manufacturing enterprises experience significant productivity improvement effects from GVC embeddedness. Specifically, this effect is obvious in capital-intensive, technology-intensive, and general trading enterprises, whereas the effect is unclear in processing trade and labor-intensive enterprises. R&D intensity can strengthen the GVC productivity effect for foreign-owned, general trade, and technology-intensive enterprises, while government subsidy intensity can strengthen the same for private and technology-intensive enterprises.

Suggested Citation

  • Ge, Jiali & Fu, Yang & Xie, Rui & Liu, Yu & Mo, Wenyang, 2018. "The effect of GVC embeddedness on productivity improvement: From the perspective of R&D and government subsidy," Technological Forecasting and Social Change, Elsevier, vol. 135(C), pages 22-31.
    • Handle: RePEc:eee:tefoso:v:135:y:2018:i:c:p:22-31
    DOI: 10.1016/j.techfore.2018.07.057
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