This paper explores how changes in both position and participation in Global Value Chain networks affect firm innovation. The analysis combines matched patent-firm data for Japan with measures of GVC network centrality and GVC participation utilizing the OECD Inter-Country Input-Output Tables for the period 1995 to 2011. We find that Japan’s position in the 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 WTO accession as an instrumental variable for changes in Japanese centrality. Our analysis shows that increases in forward centrality – as a key supplier – tend to be positively associated with increasing firm patent applications. Firms in key hubs within GVCs, specifically as key suppliers, appear to benefit from knowledge spillovers from various customers and downstream markets.
Study co-authored with Kenta IKEUCHI (Research Institute of Economy, Trade and Industry), Chiara CRISCUOLO (Organisation for Economic Co-operation and Development), Jonathan TIMMIS (IFC – World Bank Group), Antonin BERGEAUD (Banque de France).
Speaker: Keiko ITO (Chuo University)
Keiko Ito (Dr.) is a professor at the Faculty of Commerce, Chuo University, Japan. She received her Ph.D. in Economics from Hitotsubashi University in 2002. She taught at Senshu University (2004-2018), and was staff on loan at the OECD (2016-2017) and a visiting fellow at Columbia University (2007-2008). Her research interests are on the empirical analysis on international trade and foreign direct investment, and industry and firm-level productivity analysis, mainly using firm- or plant-level data. She authored a number of academic articles on these research areas.
Moderator: Jean-Pascal BASSINO (French Research Institute on Japan – MFJ)Organization: FRIJ-MFJCo-organization: CCI France JaponSupport: French Embassy in Japan