Global value chains and domestic innovation |
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| Institution: | 1. Graduate School of Social Sciences, Chiba University, 1-33, Yayoi-cho, Inage, Chiba 263-8522, Japan;2. Research Institute of Economy, Trade and Industry (RIETI), 1-3-1, Kasumigaseki, Chiyoda, Tokyo 100-8901, Japan;3. Organisation for Economic Co-operation and Development (OECD), 2, rue André Pascal, Paris Cedex 16 75775, France;4. World Bank, 1818 H Street, Washington, DC 20433, USA;5. HEC Paris, 1 Rue de la Libération, 78350 Jouy-en-Josas, France;6. Centre for Economic Performance, London School of Economics and Political Science, Houghton Street, London WC2A 2AE, United Kingdom;1. Henley Business School at the University of Reading, United Kingdom;2. Strathclyde Business School, United Kingdom, and “Alfred D. Chandler Jr. International Visiting Scholar in Business History”, Harvard Business School, Boston MA USA.;1. National Scientific and Technical Research Council/Centro de Investigaciones para la Transformación (CENIT), National University of San Martin (UNSAM), Av. Presidente Roque Saenz Peña 832, Buenos Aires, Argentina;2. Science and Technology Policy Research Unit (SPRU), University of Sussex, United Kingdom;3. Institute of Development Studies (IDS), University of Sussex, Library Rd, Falmer, Brighton BN1 9RE, United Kingdom;1. Professor of Innovation and Entrepreneurship, Department of Management, Birkbeck, University of London, Malet Street, London WC1E 7HX, UK;2. Vising Fellow, InnoLab, University of Vaasa, PB 700, 65101 Vaasa, Finland;3. Associate Professor of International Business Strategy, Leeds University Business School, University of Leeds, UK;4. Associate Professor of Organizational Behavior and Negotiations, Imperial College Business School, Imperial College London, SW7 2AZ, UK;1. INGENIO (CSIC-UPV), Universitat Politècnica de València, Camino de Vera s/n, 46022 Valencia, Spain;2. Departamento de Información y Comunicación, Universidad de Granada, Colegio Máximo de Cartuja s/n, Granada 18071, Spain |
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| Abstract: | This paper explores how changes in both position and participation in Global Value Chain (GVC) networks affect firm innovation. The analysis combines matched patent-firm data for Japan with measures of GVC network centrality and GVC participation using the OECD Inter-Country Input-Output (ICIO) Tables over the period from 1995 to 2011. We find that Japan's position in GVCs has shifted from being at the core of Asian value chains towards the periphery relative to other countries in the network, i.e., becoming less “central”. We use China's accession to the World Trade Organization as an instrumental variable for changes in Japanese centrality. Our analysis shows that increases in Japanese sectors' forward centrality – i.e. as a key supplier - tend to be positively associated with increasing firms' patent applications in these sectors and that firms in key hubs within GVCs, specifically as key suppliers, appear to benefit from knowledge spillovers from downstream markets. |
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