Global value chains: Building blocks and network dynamics

Abstract

The paper employs measures and tools from complex network analysis to enhance the understanding and interpretation of structural characteristics pertaining to the Global Value Chains (GVCs) during the period 1995–2011. The analysis involves the country, sector and country-sector value chain networks to identify main drivers of structural change. The results indicate significant intertemporal changes, mirroring the increased globalization in terms of network size, strength and connectivity. They also demonstrate higher clustering and increased concentration of the most influential countries and country-sectors relative to all others in the GVC network, with the geographical dimension to prevail over the sectoral dimension in the formation of value chains. The regionalization and less hierarchical organization drive country-sector production sharing, while the sectoral value chain network has become more integrated and more competitive over time. The findings suggest that the impact of country-sector policies and/or shocks may vary with the own-group and network-wide influence of each country, take place in multiple geographical scales, as GVCs have a block structure, and involve time dynamics.