How Does Economic Policy Uncertainty Impact a Country's Position in Global Value Chains?

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外文摘要：Economic globalization in the 21st century has been characterized by the rise and spread of global value chains(GVCs).It faces significant challenges due to increasing domestic and international policy uncertainty in the context of emerging mega risks like geopolitical tensions and climate change.This paper begins by constructing a theoretical model for an open economy to study how risk-averse firms make decisions regarding the sourcing of intermediate inputs in an uncertain environment.Our model solution proposes thatfirms will source fewer intermediate inputsfrom countries with more economic uncertainty An increase in domestic and foreign uncertainty will have opposite impacts on a country's position in GVCs.In this sense,we argue that a country tends to move downstream along GVCs if its own economic policies become more uncertain,and it tends to move upstream with an increase in the uncertainty of its trading partner countries.Our regression analyses,based on data including the World Input-Output Database,World Development Indicators,the UN Comtrade database,and the Economic Policy Uncertainty Index,provide empirical support for this model-based conclusion.Our findings highlight that a nation must consider foreign economic policy uncertainty and maintain domestic policy stability to participate in GVCs.

外文关键词：

economic policy uncertaintyglobal value chainGVC participationGVC position

作者：

Jiaxuan Zhang、Hongsheng Zhang、Xuhang Shen、Bo Meng

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作者单位：

Institute of Economics,School of Social Sciences,Tsinghua University,China

China Academy of Digital Trade,Zhejiang University,China

HSBC Business School,Peking University China

Institute of Developing Economies,Japan External Trade Organization,Japan

Collaborative Innovation Center for Emissions Trading System Co-constructed by the Province and Ministry,Hubei University of Economics,China

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出版年：

2024

中国与世界经济(英文版)

中国社会科学院世界经济与政治研究所

中国与世界经济(英文版)

ISSN：1671-2234

年,卷(期)：2024.32(5)