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Up or down the value chain? The comparative analysis of the GVC position of the economies of the new EU member states

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  • Jan Hagemejer

    (Faculty of Economic Sciences, University of Warsaw; Economic Institute, National Bank of Poland)

  • Mahdi Ghodsi

    (Vienna Institute for International Economic Studies)

Abstract

The pattern of trade of the Central and Eastern European countries has been changing since the beginning of the economic transition in the early 1990s. By the end of the century this process was additionally strengthened by their integration with the EU and overlapped with the development of global value chains (GVC) spanning across Europe with which the new member states (NMS) have become increasingly integrated. In this paper, we shed lights on these changes by analyzing the position of the NMS within the global value chains. We employ the upstreamness measure proposed by Antras et al. 2012 and use the World Input-Output Database. Although we observe a global increasing trend in the upstreamness of all countries, we find that the NMS have in many cases gone against this trend while converging in their production structure within their group and with the EU-15. This convergence is mostly present in Czech Republic, Hungary, Poland and Slovakia where the level of upstreamness in the most important exporting sectors was close to that of Germany by the end of the analyzed period 1995-2011.

Suggested Citation

  • Jan Hagemejer & Mahdi Ghodsi, 2016. "Up or down the value chain? The comparative analysis of the GVC position of the economies of the new EU member states," Working Papers 2016-23, Faculty of Economic Sciences, University of Warsaw.
    • Handle: RePEc:war:wpaper:2016-23
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    References listed on IDEAS

    as
    1. Pol Antras & Davin Chor & Thibault Fally & Russell Hillberry, 2012. "Measuring the Upstreamness of Production and Trade Flows," American Economic Review, American Economic Association, vol. 102(3), pages 412-416, May.
    2. Carlo Altomonte & Filippo Di Mauro & Gianmarco I. P. Ottaviano & Armando Rungi & Vincent Vicard, 2012. "Global Value Chains During the Great Trade Collapse: A Bullwhip Effect?," CEP Discussion Papers dp1131, Centre for Economic Performance, LSE.
    3. João Amador & Rita Cappariello & Robert Stehrer, 2015. "Global Value Chains: A View from the Euro Area," Asian Economic Journal, East Asian Economic Association, vol. 29(2), pages 99-120, June.
    4. Richard Baldwin, 2013. "Trade and Industrialization after Globalization's Second Unbundling: How Building and Joining a Supply Chain Are Different and Why It Matters," NBER Chapters, in: Globalization in an Age of Crisis: Multilateral Economic Cooperation in the Twenty-First Century, pages 165-212, National Bureau of Economic Research, Inc.
    5. repec:dgr:rugggd:gd-133 is not listed on IDEAS
    6. Zhi Wang & Shang-Jin Wei & Kunfu Zhu, 2013. "Quantifying International Production Sharing at the Bilateral and Sector Levels," NBER Working Papers 19677, National Bureau of Economic Research, Inc.
    7. Erik Dietzenbacher & Isidoro Romero, 2007. "Production Chains in an Interregional Framework: Identification by Means of Average Propagation Lengths," International Regional Science Review, , vol. 30(4), pages 362-383, October.
    8. Johnson, Robert C. & Noguera, Guillermo, 2012. "Accounting for intermediates: Production sharing and trade in value added," Journal of International Economics, Elsevier, vol. 86(2), pages 224-236.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Jan Hagemejer, 2015. "Productivity spillovers in the GVC. The case of Poland and the New EU Member States," Working Papers 2015-42, Faculty of Economic Sciences, University of Warsaw.
    2. Zhong, Zhangqi & Guo, Zhifang & Zhang, Jianwu, 2021. "Does the participation in global value chains promote interregional carbon emissions transferring via trade? Evidence from 39 major economies," Technological Forecasting and Social Change, Elsevier, vol. 169(C).
    3. Roman Stöllinger, 2019. "Testing the Smile Curve: Functional Specialisation in GVCs and Value Creation," wiiw Working Papers 163, The Vienna Institute for International Economic Studies, wiiw.
    4. repec:gdk:wpaper:53 is not listed on IDEAS
    5. Zoltán Fülöp, 2023. "Evolvement of Global Value Chain Positions in Central and Eastern European Countries: A New Dimension in Catching Up?," Central European Business Review, Prague University of Economics and Business, vol. 2023(3), pages 47-80.
    6. Sabina Szymczak & Aleksandra Parteka & Joanna Wolszczak-Derlacz, 2022. "Position in global value chains and wages in Central and Eastern European countries," European Journal of Industrial Relations, , vol. 28(2), pages 211-230, June.
    7. Jan Hagemejer & Joanna Tyrowicz, 2017. "Upstreamness of employment and global financial crisis in Poland: the role of position in the global value chains," GRAPE Working Papers 15, GRAPE Group for Research in Applied Economics.
    8. Mahdi Ghodsi, 2020. "Is Austria’s economy locked-in in the CESEE region? Austria’s competitiveness at the micro-level," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 47(3), pages 669-693, August.
    9. Kordalska, Aleksandra & Olczyk, Magdalena, 2021. "Linkages between services and manufacturing as a new channel for GVC development: Evidence from CEE countries," Structural Change and Economic Dynamics, Elsevier, vol. 58(C), pages 125-137.
    10. Ying Zhou & Sajid Anwar, 2022. "Immigrant Diversity, Institutional Quality, and GVC Position," Sustainability, MDPI, vol. 14(4), pages 1-19, February.
    11. Pleticha, Petr, 2021. "Who Benefits from Global Value Chain Participation? Does Functional Specialization Matter?," Structural Change and Economic Dynamics, Elsevier, vol. 58(C), pages 291-299.
    12. Lucía Bolea & Rosa Duarte & Geoffrey J. D. Hewings & Sofía Jiménez & Julio Sánchez‐Chóliz, 2022. "The role of regions in global value chains: an analysis for the European Union," Papers in Regional Science, Wiley Blackwell, vol. 101(4), pages 771-794, August.
    13. Sabina Szymczak, 2018. "Production fragmentation and employment. Country-industry level analysis based on WIOD 2016," Collegium of Economic Analysis Annals, Warsaw School of Economics, Collegium of Economic Analysis, issue 53, pages 131-146.
    14. Dai, Feng & Liu, Ruixiang & Guo, Hao & Du, Xiuhong, 2020. "How does intermediate consumption affect GVC positions? - A comparison between China and US," China Economic Review, Elsevier, vol. 63(C).
    15. Duarte, Rosa & Espinosa-Gracia, Adrián & Jiménez, Sofía & Sánchez-Chóliz, Julio, 2022. "New insights on the relationship between the involvement of countries in global value chains, and intra- and inter-country inequalities," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 320-329.
    16. Aleksandra Nacewska-Twardowska, 2021. "Central and Eastern Europe Countries in the New International Trade Environment at the Beginning of the 21st Century: Global Value Chains and COVID-19," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 3), pages 547-560.
    17. Stöllinger, Roman, 2021. "Testing the Smile Curve: Functional Specialisation and Value Creation in GVCs," Structural Change and Economic Dynamics, Elsevier, vol. 56(C), pages 93-116.
    18. Li, Feiyang & Lin, Ziyue & Huang, Liangxiong & Yang, Caiting, 2022. "Environmental regulation and global value chain division position：Analysis based on global transnational data," Energy Policy, Elsevier, vol. 168(C).
    19. Halit Yanikkaya & Abdullah Altun & Pınar Tat, 2022. "Does the Complexity of GVC Participation Matter for Productivity and Output Growth?," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(4), pages 2038-2068, August.

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    More about this item

    Keywords

    global value chains; upstreamness; European Union; New Member States;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • F10 - International Economics - - Trade - - - General
    • F15 - International Economics - - Trade - - - Economic Integration

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