Global Value Chain Embeddedness and Potential for National Export Structure Transformation

This study examines how embeddedness in global value chains (GVCs) affects the potential for national export structural transformation using country-sector level data during the 2000-2014 period. The empirical results indicate that increased GVC participation and position positively impact the potential for export structure transformation. However, the length of the GVC production chain has a negative effect. The results reveal that improving technological capability and value-added capacity contributes to cultivating the potential for structural transformation among GVC participants. However, extending the production chain may mitigate the positive effects of value-added capability improvements and impede structural transformation potential.