Arbeitspapier

Testing the Smile Curve: Functional Specialisation in GVCs and Value Creation

According to the 'smile curve hypothesis' the potential for generating value added varies significantly across the various functions along a firm's value chain. It suggests in particular that the production stage is the least promising value chain function in the entire manufacturing process. This logic implies that countries specialising as 'factory economies' are likely to generate comparatively little value added. To shed light on the relationship between functional specialisation along the value chain and value creation, this paper develops measures for functional specialisation derived from project-level data on greenfield FDI for a global sample of countries. These measures keep the industry and the functional dimension of specialisation strictly apart. They are used to test econometrically the negative relationship between value added creation and functional specialisation in production as predicted by the smile curve hypothesis.

Sprache
Englisch

Erschienen in
Series: wiiw Working Paper ; No. 163

Klassifikation
Wirtschaft
Economic Impacts of Globalization: General
Organization of Production
International Factor Movements and International Business: General
Thema
functional specialisation
global value chains
smile curve
factory economy
greenfield FDI

Ereignis
Geistige Schöpfung
(wer)
Stöllinger, Roman
Ereignis
Veröffentlichung
(wer)
The Vienna Institute for International Economic Studies (wiiw)
(wo)
Vienna
(wann)
2019

Handle
Letzte Aktualisierung
10.03.2025, 11:43 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Stöllinger, Roman
  • The Vienna Institute for International Economic Studies (wiiw)

Entstanden

  • 2019

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