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

Javier Lopez Gonzalez, Valentina Meliciani () and Maria Savona ()
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Valentina Meliciani: Faculty of Political Sciences, University of Teramo, Campus Coste S. Agostino, Via R. Balzarini 1, 64100, Teramo, Italy

SPRU Working Paper Series from SPRU - Science Policy Research Unit, University of Sussex Business School

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.

Keywords: Business services; Global Value Chains; Hirschman linkages; development (search for similar items in EconPapers)
JEL-codes: F63 L16 L80 O14 (search for similar items in EconPapers)
Date: 2015-07
New Economics Papers: this item is included in nep-hme and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Journal Article: When Linder meets Hirschman: inter-industry linkages and global value chains in business services (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:sru:ssewps:2015-20

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