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Quantity or quality: How does GVC participation affect the innovation performance of Chinese firms?

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  • Meng, Shuang
  • Yan, Huan
  • Yu, Jiajie

Abstract

This study examines how GVC participation affects innovation quantity (patent outputs) and quality (patent citations) among Chinese firms from 2008 to 2015. We find that GVC participation increases innovation quantity but reduces quality, reflecting low-end lock-in effects and reliance on foreign technologies. Heterogeneity analyses reveal that labor-intensive industries gain most in patent quantity, while technology-intensive sectors suffer sharpest quality declines. By distinguishing innovation’s dual dimensions and firm-level heterogeneity, this research challenges homogenized views of GVC impacts and bridges GVC governance debates with innovation theory. These findings can guide emerging economies in leveraging GVCs for sustainable, quality-driven innovation.

Suggested Citation

  • Meng, Shuang & Yan, Huan & Yu, Jiajie, 2026. "Quantity or quality: How does GVC participation affect the innovation performance of Chinese firms?," Finance Research Letters, Elsevier, vol. 87(C).
    • Handle: RePEc:eee:finlet:v:87:y:2026:i:c:s1544612325022688
    DOI: 10.1016/j.frl.2025.109024
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