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When Linder Meets Hirschman: Inter-Industry Linkages and Global Value Chains in Business Services

Author

Listed:
  • Javier Lopez Gonzalez

    () (OECD Trade and Agriculture Directorate - Development Division, Paris)

  • Valentina Meliciani

    () (Faculty of Political Sciences, University of Teramo, Campus Coste S. Agostino, Via R. Balzarini 1, 64100, Teramo, Italy)

  • Maria Savona

    () (Science Policy Research Unit (SPRU), University of Sussex)

Abstract

The scholarship on Global Value Chains (GVCs) is recently focusing on the international fragmentation of production that involves services and in particular business services. It has been argued that participation in business services GVCs might open up new opportunities for structural change and catching up in developing countries. What are the theoretical and empirical bases for such a claim? This paper puts forward the conjecture that factor endowments and costs are not the only driver for the emergence of service GVCs and that the specific domestic structure of backward linkages à la Hirschman is of great importance. We empirically test this conjecture on the basis of the World Input Output Data in a GMM framework. We then attempt brief implications in terms of industrial policy for developing countries, particularly on the importance of developing domestic specialisation in business services before joining GVCs as a catching-up strategy.

Suggested Citation

  • Javier Lopez Gonzalez & Valentina Meliciani & Maria Savona, 2015. "When Linder Meets Hirschman: Inter-Industry Linkages and Global Value Chains in Business Services," SPRU Working Paper Series 2015-20, SPRU - Science Policy Research Unit, University of Sussex Business School.
  • Handle: RePEc:sru:ssewps:2015-20
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    File URL: http://www.sussex.ac.uk/spru/documents/2015-20-swps-lopez-gonzalez-meliciani-savona.pdf
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    References listed on IDEAS

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    Cited by:

    1. Geuna, Aldo & Piolatto, Matteo, 2016. "Research assessment in the UK and Italy: Costly and difficult, but probably worth it (at least for a while)," Research Policy, Elsevier, vol. 45(1), pages 260-271.
    2. repec:bla:devchg:v:49:y:2018:i:6:p:1495-1525 is not listed on IDEAS
    3. Mariana Mazzucato, 2015. "The Green Entrepreneurial State," SPRU Working Paper Series 2015-28, SPRU - Science Policy Research Unit, University of Sussex Business School.
    4. Lorenz Gollwitzer & David Ockwell & Adrian Ely, 2015. "Institutional Innovation in the Management of Pro-Poor Energy Access in East Africa," SPRU Working Paper Series 2015-29, SPRU - Science Policy Research Unit, University of Sussex Business School.
    5. Mariana Mazzucato, 2015. "From Market Fixing to Market-Creating: A New Framework for Economic Policy," SPRU Working Paper Series 2015-25, SPRU - Science Policy Research Unit, University of Sussex Business School.

    More about this item

    Keywords

    Business services; Global Value Chains; Hirschman linkages; development;

    JEL classification:

    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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