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Do global value chains enhance or slog economic growth?

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  • Bhushan Praveen Jangam
  • Badri Narayan Rath

Abstract

This paper examines the link between trade and economic growth by emphasizing on recent progress of global value chains (GVCs) for a sample of 58 countries over the period 2005–2015. The findings show that trade and in particular trade linked to GVCs spurs economic growth. However, the impact of GVC engagement on economic growth is diverse as we broaden our analysis to sectoral level. The study also notes that the benefits associated with regional value chains are higher. Furthermore, functional specialization in trade also plays a key role in improving growth. Therefore, policies to promote the GVC engagement and strengthening the domestic fundamentals should be the aim for countries to further benefit from trade.

Suggested Citation

  • Bhushan Praveen Jangam & Badri Narayan Rath, 2021. "Do global value chains enhance or slog economic growth?," Applied Economics, Taylor & Francis Journals, vol. 53(36), pages 4148-4165, August.
    • Handle: RePEc:taf:applec:v:53:y:2021:i:36:p:4148-4165
    DOI: 10.1080/00036846.2021.1897076
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    7. D. Dessì & R. Paci, 2023. "The impact of Global Value Chains participation on countries' productivity," Working Paper CRENoS 202305, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    8. Can Li & Qi He & Han Ji, 2023. "Can Global Value Chain Upgrading Promote Regional Economic Growth? Empirical Evidence and Mechanism Analysis Based on City-Level Panel Data in China," Sustainability, MDPI, vol. 15(15), pages 1-22, July.
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