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Digitalization and Global Value Chain Participation: Microdata Evidence from a Transitional Country

Author

Listed:
  • Viet Ha Hoang

    (aculty of International Business and Economics, VNU University of Economics and Business, Hanoi, Viet Nam)

  • Duc Tri Chu

    (Thuong Mai University, Hanoi, Vietnam)

  • Thu Phuong Pham

    (Faculty of International Business and Economics, VNU University of Economics and Business, Hanoi, Viet Nam)

  • Van-Chung Dong

    (International School, Vietnam National University, Hanoi, Viet Nam)

Abstract

In the context of Fourth Industrial Revolution, digitalization has been recognized as a key driver of long-term development in developing countries. This study aims to explore the impact of digitalization on the global value chain (GVC) participation of Vietnamese enterprises between 2005 and 2023. Utilizing a probit model, the findings show that digitalization positively affects firms’ GVC participation. The results are robust across various definitions of GVC participation. The study also finds that labor productivity, costs at custom gates, and import licenses play important roles in promoting firms engaged in GVCs. Meanwhile, firm age does not have significant effect on GVC engagement. Regarding heterogeneous effects, digitalization has a more profound effect on medium-sized firms than on large ones. Based on these findings that we propose several policy implications to encourage Vietnamese firms to adopt digitalization and deepen their involvement in global value chains.

Suggested Citation

  • Viet Ha Hoang & Duc Tri Chu & Thu Phuong Pham & Van-Chung Dong, 2025. "Digitalization and Global Value Chain Participation: Microdata Evidence from a Transitional Country," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 4, pages 1149-1161, Desember.
    • Handle: RePEc:nwe:eajour:y:2025:i:4:p:1149-1161
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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