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FDI Patterns and Global Value Chains in the Digital Economy

Author

Listed:
  • Antonello Zanfei

    (Department of Economics, Society & Politics, Università di Urbino Carlo Bo)

  • Andrea Coveri

    (Department of Economics, Society & Politics, Università di Urbino Carlo Bo)

  • Mario Pianta

    (Scuola Normale Superiore, Florence)

Abstract

The modern process of digitalization of the world economy entails global flows of investment in technology-based industries and knowledge activities located upstream of value chains. This work exploits the wealth of information offered by the fDi Markets database to provide an overview about the geographical patterns of FDIs and of specialization in digital industries and in technological activities.We showremarkable differences across both advanced and emerging economies in this respect. Europe is both a big attractor and a big investor in digital related business, but relies on emerging economies more to offshore production than to set up R&D labs in these countries. By contrast, North American economies are more prone to engage in knowledge intensive FDIs towards the most dynamic emerging countries than is the case of Europe.Emerging economies also play a large variety of rolesinglobal flows of investment in digital industries.However, with the relevant exceptions of China, India and the Four Asian Tigers, inward and outward FDIsof Emerging economies are predominantlyproduction-oriented, with a lower involvement in R&D, Design and ICT activities. Hence, the observed patterns of FDIs appear to consolidate existing hierarchies in digital related global production networks, creating limited upgrading opportunities in the case of most emerging economies.

Suggested Citation

  • Antonello Zanfei & Andrea Coveri & Mario Pianta, 2019. "FDI Patterns and Global Value Chains in the Digital Economy," Working Papers 1903, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2019.
  • Handle: RePEc:urb:wpaper:19_03
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    References listed on IDEAS

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    Cited by:

    1. Andrea Coveri & Antonello Zanfei, 2023. "Who wins the race for knowledge-based competitiveness? Comparing European and North American FDI patterns," The Journal of Technology Transfer, Springer, vol. 48(1), pages 292-330, February.
    2. Elena Paglialunga & Andrea Coveri & Antonello Zanfei, 2020. "Climate change and inequality in a global context. Exploring climate induced disparities and the reaction of economic systems," Working Papers 2003, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2020.
    3. Andrea Coveri & Antonello Zanfei, 2023. "The virtues and limits of specialization in global value chains: analysis and policy implications," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 50(1), pages 73-90, March.
    4. Andrea Coveri & Claudio Cozza & Leopoldo Nascia & Antonello Zanfei, 2020. "Supply chain contagion and the role of industrial policy," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 47(3), pages 467-482, September.

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    More about this item

    Keywords

    Foreign direct investment; globalization; digitalization; global value chains.;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F60 - International Economics - - Economic Impacts of Globalization - - - General
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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