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Participation of developing countries in global value chains: What role for information and communication technologies?

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  • Gniniguè, Moukpè
  • Wonyra, Kwami Ossadzifo
  • Tchagnao, Abdou-Fataou
  • Bayale, Nimonka

Abstract

This paper introduces model uncertainty into the empirical study on the effect of Information and Communication Technologies (ICTs) in the countries' participation in Global Value Chains (GVCs). This is done by adopting a panel Bayesian model averaging approach applied on the data of 44 developing countries, spanning the period 1990–2019. Findings indicate that ICTs positively and significantly affect the participation of developing countries in GVCs. This positive and significant effect of ICTs on countries participation in GVCs can be explained by the fact that ICTs, especially digitalization may help countries improve their competitiveness in the global market as a result of effects on competitive advantages, including price, product and service. Then, the study deeply explores the relationship between ICTs, other control variables and countries' participation in GVCs by employing the Driscoll and Kraay estimator and the Generalized Method of Moments (GMM) technique. The results are robust and confirm the results of the Bayesian approach. These findings suggest the need to support the access and the use of ICTs in developing countries to enhance their participation in GVCs.

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  • Gniniguè, Moukpè & Wonyra, Kwami Ossadzifo & Tchagnao, Abdou-Fataou & Bayale, Nimonka, 2023. "Participation of developing countries in global value chains: What role for information and communication technologies?," Telecommunications Policy, Elsevier, vol. 47(3).
    • Handle: RePEc:eee:telpol:v:47:y:2023:i:3:s0308596123000198
    DOI: 10.1016/j.telpol.2023.102508
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    2. Essossinam Ali & Hodabalo Bataka & Kwami Ossadzifo Wonyra & Nadège Essossolim Awade & Nèmè Nalèwazou Braly, 2024. "Global value chains participation and environmental pollution in developing countries: Does digitalization matter?," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(1), pages 451-478, January.
    3. Badassa W. Chala, 2024. "Effects of economic freedom and ease of doing business on trade in global value chains: Evidence from sub‐Saharan Africa," African Development Review, African Development Bank, vol. 36(1), pages 70-83, March.
    4. Wang, Lei & Ramsey, Thomas Stephen, 2024. "Digital divide and environmental pressure: A countermeasure on the embodied carbon emissions in FDI," Technological Forecasting and Social Change, Elsevier, vol. 204(C).
    5. Mwananziche, Josephat & Myovella, Godwin & Karacuka, Mehmet & Haucap, Justus & Moshi, Goodiel, 2023. "Is digitalization a booster for economic growth in Africa? Short run and long run evidence from Tanzania," Telecommunications Policy, Elsevier, vol. 47(10).

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    More about this item

    Keywords

    Global value chains; Information and communication technologies; Bayesian model averaging model;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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