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Economies
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Global Value Chains—Development Challenges in Uncertain Circumstances
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Global Value Chains—Development Challenges in Uncertain Circumstances

A special issue of Economies (ISSN 2227-7099). This special issue belongs to the section "International, Regional, and Transportation Economics".

Deadline for manuscript submissions: closed (31 March 2024) | Viewed by 9393

Special Issue Editor

Prof. Dr. Ines Kersan-Škabić

E-Mail Website
Guest Editor
Department of National and International Economics, Faculty of Economics and Tourism “Dr. Mijo Mirković”, Juraj Dobrila University of Pula, 52100 Pula, Croatia
Interests: foreign direct investment; European Union; global studies; economic development; innovation; economic growth; econometric analysis; international business development; international business; international finance

Special Issue Information

Dear Colleagues,

Global value chains (GVCs) have arisen as a result of the process of globalization, trade liberalization, and the opening of borders for the flow of goods, services, and capital, and the term refers to the fragmentation of production processes into a series of stages and processes located in different locations and in different countries. Participation in GVCs has been growing but was strongly threatened by the emergence of the COVID-19 and the subsequent closing of borders, which highlighted the precariousness of production that depends on imports from abroad. Additionally, since 2022, value chains have also been threatened by the Russia–Ukraine conflict. Production problems have appeared in various industries—from automotives to pharmaceuticals. In context of the above situations, questions regarding the future of GVCs and the challenges facing their development are reasonable and necessary. The development directions of GVCs include the following: nearshoring (regionalization), the diversification of suppliers, the resilience of supply chains, the shortening of GVCs, sustainability, scepticism about globalization, digitalization, and creating appropriate risk-management strategies.

In this Special Issue, Economies invites researchers and academics to submit their work to a Special Issue dedicated to “Global Value Chains—Development Challenges in Uncertain Circumstances”.  Some of the topics that this Special Issue could address include but are not limited to: GVCs in specific industry sector(s); GVCs in medical products; energy and GVCs; the regionalization of GVC; risk-management in GVCs; Russia–Ukraine conflict and GVCs; and technology and innovation in GVCs. Submitted papers can be theoretical or empirical and can be case studies, comparative or institutional analyses, theoretical contributions, or empirical work, among others.

Prof. Dr. Ines Kersan-Škabić
Guest Editor

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Economies is an international peer-reviewed open access monthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 1800 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • GVC and COVID-19
  • GVC and energy
  • GVC and climate challenges
  • GVC nearshoring
  • regionalization of GVCs
  • risk-management in GVCs
  • GVC and FDI
  • GVC in emerging economies
  • GVC and protectionism (trade policy)
  • GVC in specific sector(s)
  • GVC in services
  • trade in intermediate products
  • trade and value added

Published Papers (7 papers)

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Research

19 pages, 333 KiB  
Article
The Manufacturing Reshoring Phenomenon: A Policy-Oriented Analysis of Factors Driving the Location Decision
by Xavier Bornert and Dario Musolino
Economies 2024, 12(5), 100; https://0-doi-org.brum.beds.ac.uk/10.3390/economies12050100 - 25 Apr 2024
Viewed by 259
Abstract
For several decades, multinational enterprises (MNEs) have offshored their manufacturing activities to low-cost countries to achieve significant productivity gains. However, changes in the relative competitiveness of countries, social effects of deindustrialization in advanced economies and the vulnerability of global value chains (GVCs) revealed [...] Read more.
For several decades, multinational enterprises (MNEs) have offshored their manufacturing activities to low-cost countries to achieve significant productivity gains. However, changes in the relative competitiveness of countries, social effects of deindustrialization in advanced economies and the vulnerability of global value chains (GVCs) revealed by the COVID-19 pandemic have encouraged some firms, supported by governments, to “reshore” part, or all of their offshore industrial operations back to their home country. Reshoring decisions are motivated by a variety of endogenous and exogenous factors that are empirically analyzed in this paper to understand how reshoring policies implemented by governments can more effectively address the factors driving the firms’ location decisions. A review of the reshoring policies implemented in Europe, the UK and the US is conducted to provide general policy recommendations regarding policy instruments, SMEs, innovation and regionalization of value chains. This paper fills a gap in the literature by connecting the micro-level supply chain management analysis of firms’ reshoring drivers with the macro-level economic policy perspective on reshoring. The review of existing reshoring policies calls for an in-depth analysis by the manufacturing sector and at the local level. Full article
(This article belongs to the Special Issue Global Value Chains—Development Challenges in Uncertain Circumstances)
26 pages, 7423 KiB  
Article
Examining the Contribution of Logistics and Supply Chain in Boosting Oman’s Trade Network
by Ashraf Mishrif, Alessandro Antimiani and Asharul Khan
Economies 2024, 12(3), 70; https://0-doi-org.brum.beds.ac.uk/10.3390/economies12030070 - 18 Mar 2024
Viewed by 945
Abstract
Economic integration, which in today’s global trade is the fundamental component of linking economic ties between countries, is another important factor in the acceleration of economic growth. The provision of trade logistics services is essential to a nation’s economic success in international trade [...] Read more.
Economic integration, which in today’s global trade is the fundamental component of linking economic ties between countries, is another important factor in the acceleration of economic growth. The provision of trade logistics services is essential to a nation’s economic success in international trade activities. It is essential for enterprises engaged in active international trade to achieve competitive advantages. The international trade and localised commercial activity, to a large extent, is dependent on the logistics and supply chain infrastructure and operational capacity. However, the area received little attention from the perspective of applied economics. The in-depth empirical studies on the impacts of logistics on trade efficiency are few and limited. The study aims to investigate the role of logistics and supply chains in international and national trade in a developing country. It uses secondary data for the analysis. The model and software used in the study are the gravity model and GTAP10a. The time horizon used spans 2014–2030. The results show that in order to enhance trading and commercial activities, a developing country should develop logistics and supply chain infrastructure, train people, and design a flexible logistics policy. Full article
(This article belongs to the Special Issue Global Value Chains—Development Challenges in Uncertain Circumstances)
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14 pages, 1069 KiB  
Article
Supply Chain Interconnectedness in Times of Crises: A Gravity Model with DiD Analysis of COVID-19 Effects on Central and Eastern European Trade
by Arūnas Burinskas, Viktorija Cohen and Jolanta Droždz
Economies 2024, 12(1), 12; https://0-doi-org.brum.beds.ac.uk/10.3390/economies12010012 - 31 Dec 2023
Viewed by 1574
Abstract
This paper explores the impact of COVID-19-induced disruptions on supply chains, specifically focusing on the interconnectedness of supply chains and the transmission effects they cause. The gravity model framework, together with difference-in-differences analysis, is employed to analyze monthly trade patterns among Central and [...] Read more.
This paper explores the impact of COVID-19-induced disruptions on supply chains, specifically focusing on the interconnectedness of supply chains and the transmission effects they cause. The gravity model framework, together with difference-in-differences analysis, is employed to analyze monthly trade patterns among Central and Eastern European (CEE) countries, Western European countries, and other trading partner countries. The model presented accounts for the country’s roles in global value chains (GVCs) by incorporating data related to exports, imports of intermediate and capital goods, and imports of final consumption goods. CEE countries have demonstrated a certain resilience during the COVID-19 pandemic. Yet, they were not immune to adverse consequences due to disrupted supply chains, primarily in the imports of intermediate and capital goods. We find that the countries that suffered from the COVID-19 pandemic the least demonstrated remarkable resilience against disrupted GVCs. The findings of our study enrich the literature on the effects of the COVID-19 pandemic, specifically for the CEE region, by providing a framework for understanding the pandemic’s impact on international trade. The results show that supply shock might be greater than demand shocks on production and trade dynamics. Furthermore, our results suggest that policymakers seek adaptability to changing supply and demand patterns, while enterprises should consider broader diversification both within the region and locally. Full article
(This article belongs to the Special Issue Global Value Chains—Development Challenges in Uncertain Circumstances)
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12 pages, 1871 KiB  
Article
Productivity and Global Value Chains: A Tale from the Indonesian Automobile Sector
by Padang Wicaksono, Yulial Hikmah and Rayinda Nur Ilmiawani
Economies 2023, 11(10), 262; https://0-doi-org.brum.beds.ac.uk/10.3390/economies11100262 - 23 Oct 2023
Viewed by 1684
Abstract
Low productivity and quality of employment have always been a big problem in Indonesia, caused by the lack and mismatch of skills in the workforce. Labor productivity (LP) describes the company’s ability to produce something. This can be determined by added value or [...] Read more.
Low productivity and quality of employment have always been a big problem in Indonesia, caused by the lack and mismatch of skills in the workforce. Labor productivity (LP) describes the company’s ability to produce something. This can be determined by added value or output. Several factors influence LP, such as education, age, and training. The concept of global value chains (GVCs) has become an integral part of economic activity, and trade within global production networks has grown more rapidly than conventional trade in final goods. GVCs have both positive and negative impacts on employment opportunities. The automotive industry is categorised as one of the ten primary priority industries in the Indonesian manufacturing sector. This research analyses the impact of LP on GVC integration in the Indonesian automotive industry. The data used in this research comes from the World Input–Output Database (WIOD) and the Central Statistics Agency (BPS) from 1995 to 2014. The variables used include the number of workers, added value, real wages, and GVC, which were calculated by the author using the Inter-Country Input–Output (ICIO) approach. Using ICIO analysis, the following matrix should be constructed to determine involvement in GVCs. This research shows that LP in the Indonesian automotive industry has a positive trend, and the GVC position in the Indonesian automotive industry has a positive trend line. The domestic value chain increased from 4% to 33%. This improves the ability to produce higher value-added and intermediate export goods. LP increases the domestic value chain in the Indonesian automotive industry, leading to global value chain integration. Thus, LP goes hand in hand with integrating GVCs. Full article
(This article belongs to the Special Issue Global Value Chains—Development Challenges in Uncertain Circumstances)
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15 pages, 1616 KiB  
Article
Do Women Benefit from Global Production Networks? Evidence from the Indonesian Footwear Industry
by Padang Wicaksono, Yulial Hikmah and Rieka Evy Mulyanti
Economies 2023, 11(9), 233; https://0-doi-org.brum.beds.ac.uk/10.3390/economies11090233 - 13 Sep 2023
Viewed by 1824
Abstract
Despite the remarkable improvements in key economic and social standards, the Indonesian footwear industry still struggles to ensure decent work, particularly for women workers. In this paper, female workers are divided into production and non-production workers. Women production workers are used as a [...] Read more.
Despite the remarkable improvements in key economic and social standards, the Indonesian footwear industry still struggles to ensure decent work, particularly for women workers. In this paper, female workers are divided into production and non-production workers. Women production workers are used as a proxy for occupational segregation based on sex, called non-skilled workers, while women non-production workers are used as a proxy for women’s share of work in managerial and administrative work, called skilled workers. This paper examines the close links between decent work (DW) and global production networks (GPNs) in the Indonesian footwear industry. More specifically, this article scrutinizes fair employment treatment for local female employees within the DW framework in the country’s footwear industry with the expansion of GPNs based on Indonesian footwear firm-level panel data from 2001 to 2015. Vertical specialization is a proxy for GPNs and is the main independent variable in this paper. The results show that vertical specialization is in line with the fair treatment indicators and has a significant level for female production workers. In addition, the other independent variable, namely the wages of production workers, has a significant level, and the results are inversely proportional to the fair treatment indicator, while the wages of non-production workers show results that are inversely proportional to female production workers but positive for female non-production workers. This shows that an increase in the wages of production workers is less profitable for female production workers than for female non-production workers. Thus, the results show that the expansion of GPNs in the Indonesian footwear sector has essentially led to improved fair employment treatment, especially for women workers. Full article
(This article belongs to the Special Issue Global Value Chains—Development Challenges in Uncertain Circumstances)
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24 pages, 4044 KiB  
Article
Linking Brazilian Regions to Value Chains: Is There a Potential for Regional Development?
by Eduardo Rodrigues Sanguinet, Miguel Atienza, Carlos Roberto Azzoni and Augusto Mussi Alvim
Economies 2023, 11(7), 199; https://0-doi-org.brum.beds.ac.uk/10.3390/economies11070199 - 21 Jul 2023
Viewed by 1315
Abstract
This paper examines the subnational dimension of regional value-added transfers in multiscalar value chains in Brazil by analyzing the local content embedded in trade. This study reveals distinct spatial-based connectivity patterns within subnational and global value chains. An input–output model is employed to [...] Read more.
This paper examines the subnational dimension of regional value-added transfers in multiscalar value chains in Brazil by analyzing the local content embedded in trade. This study reveals distinct spatial-based connectivity patterns within subnational and global value chains. An input–output model is employed to estimate the trade in value added from different Brazilian regions. The findings demonstrate that economically advanced regions, such as Southeastern Brazil, are both globally and nationally integrated and therefore stand to benefit from both types of integration. Conversely, subnational peripheries in the North and Northeastern states of Brazil play a crucial role in supplying raw materials for both domestic and global flows. These regions exhibit a clear profile of export dependency with low value-added content in trade. Consequently, our trade measures highlight a spatial concentration of development opportunities characterized by a distinct core–periphery pattern within the country. This imbalance in territorial capacity limits the potential for these regions to derive economic development benefits from integration into value chains. Full article
(This article belongs to the Special Issue Global Value Chains—Development Challenges in Uncertain Circumstances)
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17 pages, 1885 KiB  
Article
Some Insights into the Bilateral Value Chains—The EU and Russia
by Ines Kersan-Škabić
Economies 2023, 11(7), 186; https://0-doi-org.brum.beds.ac.uk/10.3390/economies11070186 - 07 Jul 2023
Cited by 1 | Viewed by 1108
Abstract
Russia and the EU represent two economic blocs with high-value bilateral trade, especially in several specific sectors. The Russia–Ukraine war has facilitated the escalation of protectionism against Russia, and the EU and Western partners have introduced a set of sanctions on the import [...] Read more.
Russia and the EU represent two economic blocs with high-value bilateral trade, especially in several specific sectors. The Russia–Ukraine war has facilitated the escalation of protectionism against Russia, and the EU and Western partners have introduced a set of sanctions on the import of goods from Russia, but also on EU exports to Russia. This analysis aims to research in detail the characteristics of the global value chains (GVCs) of the EU and Russia, focusing on their interconnections. Russia is a resource-rich country whose exports are mainly based on resources and resource-related products. Therefore, forward participation in global value chains dominates, being 4.5 times higher than backward participation. In the EU and its member states, backward participation dominates, implying a high level of dependence of the production process in the EU on import of intermediates (i.e., production inputs) from abroad. The analysis indicates a high share of value added from Russia in the sector “mining and quarrying, energy producing products” in the EU final demand where almost one-fifth of foreign value added pertains to products from Russia. On the other hand, the sectors of electrical equipment, pharmaceuticals, chemical products and construction in Russia rely on value added imported from the EU. Full article
(This article belongs to the Special Issue Global Value Chains—Development Challenges in Uncertain Circumstances)
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