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Global value chains in the least developed countries of the world: threats and opportunities for local producers

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  • Carlo Pietrobelli

Abstract

Global value chains (GVCs) often represent one of the few options for local firms and suppliers in developing countries to get access to larger markets and to new technologies. While the potential benefits from GVCs for medium-income developing countries are well documented, the studies dealing with the impact of GVCs on low-income, poorer countries are scarce. To explore these issues, the paper uses primary and secondary empirical evidence and discusses how GVCs may affect upgrading, technological capabilities and competitiveness in the least developed countries (LDCs). This paper suggests that the opportunities exist, but are hardly utilised, and depend on a number of circumstances that may or may not occur. Public policies have an important role to play to improve the prospects of leveraging these opportunities and raising the probability of a positive effect on local firms. This paper focuses on the prospects of upgrading in natural resource-intensive LDCs from their participation in GVCs, and argues in favour of capacity building for policy formulation and implementation, strengthening the national standards infrastructure, defining the research priorities and disseminating research results to small- and medium-sized enterprises, and suggests that cluster-based development policies may offer better perspectives.

Suggested Citation

  • Carlo Pietrobelli, 2008. "Global value chains in the least developed countries of the world: threats and opportunities for local producers," International Journal of Technological Learning, Innovation and Development, Inderscience Enterprises Ltd, vol. 1(4), pages 459-481.
  • Handle: RePEc:ids:ijtlid:v:1:y:2008:i:4:p:459-481
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    References listed on IDEAS

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    1. Fosfuri, Andrea & Motta, Massimo & Ronde, Thomas, 2001. "Foreign direct investment and spillovers through workers' mobility," Journal of International Economics, Elsevier, pages 205-222.
    2. Richard Disney & Jonathan Haskel & Ylva Heden, 2003. "Restructuring and productivity growth in uk manufacturing," Economic Journal, Royal Economic Society, vol. 113(489), pages 666-694, July.
    3. Peri, Giovanni & Urban, Dieter, 2006. "Catching-up to foreign technology? Evidence on the "Veblen-Gerschenkron" effect of foreign investments," Regional Science and Urban Economics, Elsevier, vol. 36(1), pages 72-98, January.
    4. Beata Smarzynska Javorcik, 2004. "Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages," American Economic Review, American Economic Association, pages 605-627.
    5. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," Review of Economic Studies, Oxford University Press, vol. 70(2), pages 317-341.
    6. Gorg, Holger & Strobl, Eric, 2001. "Multinational Companies and Productivity Spillovers: A Meta-analysis," Economic Journal, Royal Economic Society, vol. 111(475), pages 723-739, November.
    7. Anabel Marin & Martin Bell, 2006. "Technology spillovers from Foreign Direct Investment (FDI): the active role of MNC subsidiaries in Argentina in the 1990s," Journal of Development Studies, Taylor & Francis Journals, vol. 42(4), pages 678-697.
    8. Takii, Sadayuki, 2005. "Productivity spillovers and characteristics of foreign multinational plants in Indonesian manufacturing 1990-1995," Journal of Development Economics, Elsevier, pages 521-542.
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    Cited by:

    1. repec:spr:jknowl:v:8:y:2017:i:1:d:10.1007_s13132-015-0263-6 is not listed on IDEAS
    2. Carlo Pietrobelli, 2009. "Dualism and Power in Agriculture Scientific and Technological Development," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 1, March.
    3. repec:eee:jrpoli:v:54:y:2017:i:c:p:167-175 is not listed on IDEAS
    4. Lizbeth Navas-Alemán & Carlo Pietrobelli & Marco Kamiya, 2012. "Inter-Firm Linkages and Finance in Value Chains," IDB Publications (Working Papers) 4067, Inter-American Development Bank.
    5. repec:eee:tefoso:v:122:y:2017:i:c:p:215-230 is not listed on IDEAS
    6. Juan Chacaltana & Gustavo Yamada, 2009. "Calidad del empleo y productividad laboral en el Perú," Research Department Publications 4636, Inter-American Development Bank, Research Department.
    7. Pietrobelli, Carlo & Rabellotti, Roberta, 2011. "Global Value Chains Meet Innovation Systems: Are There Learning Opportunities for Developing Countries?," World Development, Elsevier, vol. 39(7), pages 1261-1269, July.
    8. Debapriya Bhattacharya & Khondaker Golam Moazzem, 2013. "Least Developed Countries (LDCs) in the Global Value Chain (GVC): Trends, Determinants and Challenges," CPD Working Paper 104, Centre for Policy Dialogue (CPD).

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