Reaping the Benefits from Global Value Chains

IMF Working Papers, September 28, 2015

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Against the backdrop of the rise of global value chains (GVCs), particularly in Asia, this paper documents key developments of GVCs and investigates what factors cause economies to reap greater benefits from GVC participation.
Authors: Kevin C Cheng, Sidra Rehman, Shiny Zhang
Date: September 28, 2015
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.

Moving toward a more upstream position in production and raising economic complexity are associated with the country increasing its share of GVC value added.
Fostering GVC participation and expanding the share of the domestic value added in a value chain require efforts to:
- reduce trade barriers,
- enhance infrastructure,
- foster human capital formation,
- support research and development,
- improve institutions.

Reduce trade barriers to encourage deeper participation in GVCs.
Invest in infrastructure to support more complex stages of production.
Enhance human capital formation to enable movement toward upstream production roles.
Support research and development to raise economic complexity and value-added activities.
Improve institutional quality to capture larger shares of GVC value added.

Subject: Economic sectors, Exports, Global value chains, Globalization, Human capital, International trade, Labor, Manufacturing, Tariffs, Taxes
Keywords: Asia and Pacific, Economic Complexity, Exports, Global, Global Value Chains, Growth, GVC, GVC participation, GVC pie, high-tech manufacturing, Human capital, industry Fe, low-tech manufacturing, Manufacturing, participation indices, Tariffs, trade barrier, WP