The impact of industrial digitization on the global value chains position: Evidence from China’ s industry sectors

Abstract

Industrial digitization (ID) has become a new driving force for high-quality development of industries. Existing studies have mainly examined the global value chains position (GVCP) in terms of openness and technological progress, and there are a few studies from the perspective of industrial digitization. This paper constructs an input-output model to measure the GVCP of China's industry sectors by use the world input-output database (WIOD), and empirically tests the impact of ID on the GVCP of China's industry sectors by constructing ID indicators. The conclusions of the study are shown below. First, ID significantly enhances the GVCP of China's industry sectors, which can drive the industry sectors to realize value chain climbing. Second, mechanism analyses shows that ID can enhance the GVCP by increasing export technology complexity and revealed comparative advantage of China's industry sectors. Third, ID mainly influences the forward production lengths, and ID boosts GVCP more significantly for technology-intensive and pollution-intensive sectors. Fourth, the economic consequences show that ID decreases energy intensity and labor employment by improving the GVCP of China's industry sectors. Based on the findings, we believe that upgrading the digitization of industry sectors is an effective measure to drive up the value chains.