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Promotion or hindrance? The threshold effect of services on global value chains

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  • Ying Qiu

Abstract

Using the World Input-Output Table (WIOD; Timmer et al. 2016), I introduce the proximity burden of service input to establish a threshold model, and examine the ‘double-edged sword’ effect of service input on the Global Value Chains, namely, it promotes the development of manufacturing in proximate districts but hinder those in faraway districts. I find that the service input has an inverted U-shaped effect on value chain development, and that local service input is restricted by proximity burden, which hinders the development of value chain. The findings are robust to heterogeneity analysis and endogeneity treatment.

Suggested Citation

  • Ying Qiu, 2020. "Promotion or hindrance? The threshold effect of services on global value chains," Applied Economics Letters, Taylor & Francis Journals, vol. 27(5), pages 406-411, March.
  • Handle: RePEc:taf:apeclt:v:27:y:2020:i:5:p:406-411
    DOI: 10.1080/13504851.2019.1619012
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    Cited by:

    1. Hiroyuki Taguchi & Ni Lar, 2024. "Servicification in Global Value Chains in Emerging and Developing Asian Economies," Economies, MDPI, vol. 12(6), pages 1-15, May.
    2. Taguchi, Hiroyuki, 2024. "Servicification in global value chains toward post-COVID-19 era in emerging and developing Asian economies," MPRA Paper 121004, University Library of Munich, Germany.

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