Role of Developing Economies in Global Value Chain: A Critical Evaluation

Shailly Nigam

Authors

Shailly Nigam Prince Sattam Bin Abdulaziz University

Keywords:

Global Value Chains, Emerging Economies;, Economic Development, International Economics

Abstract

In modern times, deep transition in the global economic structure has remodeled the organization of international trade. A substantial part of which, is intra-firm trade understood as the transnational flow of goods and services between parent enterprises and their associates or among these associates, in contrast with the arm’s length trade between unrelated parties (inter-firm trade). Change in production capacities happens to be one of the major factors behind this restructured international trade. As a result, local industries and national economies of various countries have become an integral part of global value chains (GVCs). These countries include
emerging economies, which are being increasingly impacted by GVCs every year. This paper analyses the role of developing economies in the global value chains. The study finds that the market growth in these economies has been the main reason for shift in end markets in GVCs, as have been the upsurge of regional trade organizations and the paradigm shift in the industrial
policies of these economies which have been more GVC oriented than the past. The study also suggests there is a word of caution against excessively GVC focused approach as it may not work favorably to the indigenous enterprises of emerging markets.

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Author Biography

Shailly Nigam, Prince Sattam Bin Abdulaziz University

Prince Sattam Bin Abdulaziz University, Kingdom of Saudi Arabia

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Role of Developing Economies in Global Value Chain: A Critical Evaluation

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Shailly Nigam, Prince Sattam Bin Abdulaziz University

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