Digital trade rule integration: Driver or disruptor of GVC restructuring?

This paper employs a two-way fixed-effects model to examine the impact of digital trade rule integration on global value chain (GVC) restructuring and the underlying mechanisms. The results demonstrate that the integration of digital trade rules significantly promotes GVC restructuring. After conducting a series of robustness checks, including instrumental variable estimation, winsorization at different thresholds, and excluding the financial crisis period, the main findings remain robust. Mechanism analysis reveals that rule integration indirectly facilitates GVC integration and upgrading through two channels: first, by reducing trade costs associated with cross-border transactions; and second, by enhancing digital infrastructure that supports more efficient coordination along global value chains. Furthermore, institutional distance and tariff dependence play negative moderating roles in the relationship between rule integration and GVC restructuring. Specifically, larger institutional disparities weaken the effectiveness of rule integration in driving restructuring, while higher tariff dependence similarly dampens this effect by increasing sensitivity to trade policy uncertainty. Heterogeneity analysis reveals that the effect is greater for the new data economy and data flow regulations, with particularly strong facilitation of value chain integration observed in South–South and North–South economies. This study provides new evidence on how digital trade rules reshape global production networks through institutional coordination and resource allocation and offers policy implications for advancing global digital governance and developing synergistic value chains.