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Research on China’s Manufacturing Industry Moving towards the Middle and High-End of the GVC Driven by Digital Economy

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  • Rongrong Zhou

    (School of Law and Business, Sanjiang University, Nanjing 210012, China)

  • Decai Tang

    (School of Law and Business, Sanjiang University, Nanjing 210012, China
    School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Dan Da

    (School of Business, Jiangsu Open University, Nanjing 210000, China)

  • Wenya Chen

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Lin Kong

    (School of Law and Business, Sanjiang University, Nanjing 210012, China)

  • Valentina Boamah

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

Abstract

A country’s manufacturing industry is often an important route for national prosperity, but it is also a conduit by which a digital economy may become truly useful. This is so the deep integration of the digital economy and manufacturing industry can enhance independent innovation efficiencies, promote the development of advanced manufacturing clusters, and constantly spawn new models, forms of business, and industries. Consequently, it is crucial to improve China’s global manufacturing value chain. This article starts with an analysis of the development status and competitiveness of the digital economy in China and abroad. It establishes a structural equation and uses the latest data from the World Input-Output and Asian Development Bank databases. It introduces new variables, such as digitization, research and development (R&D) investment, and industrial scale to empirically analyze China’s manufacturing industry’s global value chain (GVC). The results show that the digitization of China’s manufacturing industry can increase the forward participation of GVC in the manufacturing industry to improve the division status of GVCs. Analyses suggest that due to insufficient R&D investment in the division of labor in the GVCs, China’s manufacturing industry is prone to low-end lock-in, inefficient industrial structures, and weak innovation ability. Consequently, the following suggestions are proposed: China’s manufacturing industry needs to accelerate digital transformation, increase R&D investment, actively participate in the division of labor in the GVCs, and enhance core competitiveness.

Suggested Citation

  • Rongrong Zhou & Decai Tang & Dan Da & Wenya Chen & Lin Kong & Valentina Boamah, 2022. "Research on China’s Manufacturing Industry Moving towards the Middle and High-End of the GVC Driven by Digital Economy," Sustainability, MDPI, vol. 14(13), pages 1-30, June.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:13:p:7717-:d:846885
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    6. Hongtao Wang & Wencheng Cao & Fei Wang, 2022. "Digital Transformation and Manufacturing Firm Performance: Evidence from China," Sustainability, MDPI, vol. 14(16), pages 1-18, August.
    7. Kangxian Ji & Xiaoting Liu & Jian Xu, 2023. "Digital Economy and the Sustainable Development of China’s Manufacturing Industry: From the Perspective of Industry Performance and Green Development," Sustainability, MDPI, vol. 15(6), pages 1-23, March.
    8. Yuli Liu & Mingyi Shang & Jianwei Xu & Lei Zhang & Honglian Hua, 2023. "Value Chain and the Integrated Development of Manufacturing and Modernized Services: A Case Study of Shandong Province, China," Sustainability, MDPI, vol. 15(2), pages 1-25, January.
    9. Feiyan Han & Herui Wang & Hongyu Lv & Bo Li, 2022. "Research on Manufacturers’ Referral Strategy Considering Store Brand Retailers and Traditional Retailers," Mathematics, MDPI, vol. 10(18), pages 1-23, September.
    10. Bie, Fan & Yang, Yifan & Shen, Hebin & Zhao, Qi, 2024. "Inclusive digital economy, resource dependence and changes in the urban energy mix: City level analysis from China," Resources Policy, Elsevier, vol. 92(C).

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