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Technology level and the global value chain

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  • Duong Lam Anh Tran
  • Ivan Deseatnicov

Abstract

This paper investigates the role of technology levels in shaping the structure of the global value chain (GVC) at the macro level. We incorporate the Ricardian comparative advantage into the production of intermediate goods involving both snake-and spider-type supply chains to capture the overall GVC integration. We analytically find that the country with a higher technology level produces the intermediate inputs at production stages involving a higher degree of complexity, which is consistent with the real data. Finally, we calibrate the GVC participation value and wages and document the good fit of our model to the real-world data.

Suggested Citation

  • Duong Lam Anh Tran & Ivan Deseatnicov, 2023. "Technology level and the global value chain," Applied Economics, Taylor & Francis Journals, vol. 55(25), pages 2928-2943, May.
    • Handle: RePEc:taf:applec:v:55:y:2023:i:25:p:2928-2943
    DOI: 10.1080/00036846.2022.2142509
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