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Global Value Chains and the Productivity of Firms in MENA countries: Does Connectivity Matter?

Author

Listed:
  • Rym AYADI
  • Giorgia GIOVANNETTI
  • Enrico MARVASI
  • Chahir ZAKI

Abstract

We provide new evidence on the participation of firms within Global Value Chains (GVCs) for a large pool of MENA countries included in the World Bank Enterprise Surveys (WBES). Making use of several firm-level GVC participation indices, we find a positive association with firm productivity gains. Based on this result, we further investigate the complexity of GVC relationships and examine how sector/country connectivity affects firm productivity. Using a multi-level model, we augment our analysis by including centrality indicators calculated on the intermediate trade network, constructed from the EORA input-output tables. Positioning within the network structure of trade in intermediate products also plays a role. Our results indicate a positive effect of the connectivity of the sector on the Total Factor Productivity (TFP) of firms. Results remain robust after we control for the endogeneity between firm productivity and participation in GVCs.

Suggested Citation

  • Rym AYADI & Giorgia GIOVANNETTI & Enrico MARVASI & Chahir ZAKI, 2020. "Global Value Chains and the Productivity of Firms in MENA countries: Does Connectivity Matter?," Working Papers - Economics wp2020_03.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
  • Handle: RePEc:frz:wpaper:wp2020_03.rdf
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    More about this item

    Keywords

    global value chains; firm heterogeneity; MENA region; trade networks; productivity.;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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