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The value chain facing the challenges of digitalization and the economic downturn

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  • V. E. Dementiev

Abstract

The transition to digital technologies is associated with an increase in consumer requirements in a saturated market. The influence of these technologies on the configuration of value chains and on the spacial location of production links of these chains is considered. An approach based on the analysis of real situations in individual industries is used to identify the changes under study. It is shown that the popular concept of the “smiling curve”, which characterizes the distribution of added value between the chain participants, needs to be adjusted when the supplier has unique competencies. The relatively high return on assets of such suppliers is demonstrated by examples. It is shown that firms that form global value chains strive to possess their own competencies that are most important for these chains. The risks faced by value chains in a downturn in the global economy and measures to improve the sustainability of such chains are considered.

Suggested Citation

  • V. E. Dementiev, 2021. "The value chain facing the challenges of digitalization and the economic downturn," Voprosy Ekonomiki, NP Voprosy Ekonomiki, issue 3.
    • Handle: RePEc:nos:voprec:y:2021:id:2818
    DOI: 10.32609/0042-8736-2021-3-68-83
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    References listed on IDEAS

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    4. John Humphrey & Hubert Schmitz, 2002. "How does insertion in global value chains affect upgrading in industrial clusters?," Regional Studies, Taylor & Francis Journals, vol. 36(9), pages 1017-1027.
    5. Havranek, Tomas & Irsova, Zuzana, 2011. "Estimating vertical spillovers from FDI: Why results vary and what the true effect is," Journal of International Economics, Elsevier, vol. 85(2), pages 234-244.
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    1. V. E. Dementiev, 2022. "Prospects for Russia Under the Digital Domination of China and the United States," Studies on Russian Economic Development, Springer, vol. 33(4), pages 359-366, August.
    2. Cheng, Yiran & Zhou, Xiaorui & Li, Yongjian, 2023. "The effect of digital transformation on real economy enterprises’ total factor productivity," International Review of Economics & Finance, Elsevier, vol. 85(C), pages 488-501.

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