Abstract
Global Value Chains (GVC) are a channel for upgrading firm capabilities. Over the last four decades, China has rapidly grown as a result of participation in GVCs. It has become central to global production networks in many industries, accelerating the process of global diffusion of manufacturing. However, the process by which China entered into GVCs and was changed by them can be further studied. In a study of Taiwanese MNE subsidiaries in the city of Dongguan, we find that foreign direct investment, when combined with trust building collective action facilitates a region’s move to the center of global value chains. We introduce the utility of a collaborative public space (CPS) as a mechanism for this trust building and provide implications for upgrading in emerging economies.
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