ISSN: 1648 - 4460

International Journal of Scholarly Papers


Transformations  in
Business & Economics

Transformations in
Business & Economics

  • © Vilnius University, 2002-2020
  • © Brno University of Technology, 2002-2020
  • © University of Latvia, 2002-2020
Yi Yang, Shuili Yang, Xiang Lv, Tianshuo Ge

ABSTRACT. Under the backdrop of the continuous escalation of the Sino-U.S. trade friction, research on the coping strategies of the Chinese manufacturing industry has become the focus of attention for industry and academia. The characteristics of global value chains (GVCs) are of utmost importance to the formulation of industrial strategies. However, comparatively little attention has been paid to this topic in existing studies. Following the production activity decomposition framework and combining with the 2016 Release of the World Input-Output Tables, the characteristics of GVCs between China and the U.S. from the three aspects of the degree of participation, GVC status, and value-added linkage were compared, the relationship between the degree of external dependence and the degree of participation, the input of independent innovation and GVC status, the outward foreign direct investment (OFDI) and value-added linkage were empirically analyzed, the corresponding strategies were put forward. Results show that: The degree of backward participation of the Chinese manufacturing industry is significantly stronger than the degree of forward participation, whereas the degree of forward and backward participation of the U.S. manufacturing industry is comparatively balanced. The Chinese manufacturing industry can improve the structural imbalance of participation in GVCs by reducing the industry's degree of external dependence. The embedding position of the Chinese manufacturing industry is increasing rapidly, including the continued weakening of the industrial value-added, whereas the U.S. manufacturing industry has a significant rising trend toward the high end in GVCs. The Chinese manufacturing industry can increase the input of independent innovation to reverse the trend of "marginalization" of the GVC status. The value-added output linkage of the Chinese manufacturing industry is highly concentrated, whereas the input linkage is diversified and dispersed. Moreover, the characteristics of the value-added linkage clustering of the U.S. manufacturing industry are significant. The Chinese manufacturing industry can optimize the allocation scheme for the value-added linkage by transferring OFDI. This study is important for China to select the industrial strategies .

KEYWORDS:  global value chains, characteristics comparison, China's manufacturing strategy.

JEL classification:  F10, F14, L60, O14.

1Acknowledgment:  This study was supported by the Project of National Social Science Foundation of China (Grant No. 19BJY096) & the Project of Science and Technology Plan of Soft Science Foundation of Xi'an (Grant No. 2019112113RKX005SF009-2).

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Scholarly papers Transformations in Business & Economics
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