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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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    Cited by:

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    5. Cresti, Lorenzo & Dosi, Giovanni & Fagiolo, Giorgio, 2023. "Technological interdependencies and employment changes in European industries," Structural Change and Economic Dynamics, Elsevier, vol. 64(C), pages 41-57.
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    7. Jona-Lasinio, Cecilia & Manzocchi, Stefano & Meliciani, Valentina, 2019. "Knowledge based capital and value creation in global supply chains," Technological Forecasting and Social Change, Elsevier, vol. 148(C).
    8. Filippo Bontadini, 2019. "Trade Specialisation and Performance in Global Value Chains," SPRU Working Paper Series 2019-10, SPRU - Science Policy Research Unit, University of Sussex Business School.
    9. Savona, María, 2020. "A “new normal” as a “new essential”? COVID-19, digital transformations and employment structures," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    10. Mundt, Philipp & Cantner, Uwe & Inoue, Hiroyasu & Savin, Ivan & Vannuccini, Simone, 2021. "Market selection in global value chains," BERG Working Paper Series 170, Bamberg University, Bamberg Economic Research Group.
    11. Maria Markaki & Stelios Papadakis & Anna Putnová, 2021. "A Modern Industrial Policy for the Czech Republic: Optimizing the Structure of Production," Mathematics, MDPI, vol. 9(23), pages 1-20, November.
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    13. Mariana Mazzucato, 2015. "The Green Entrepreneurial State," SPRU Working Paper Series 2015-28, SPRU - Science Policy Research Unit, University of Sussex Business School.
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    More about this item

    Keywords

    Business services; Global Value Chains; Hirschman linkages; development;
    All these keywords.

    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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