DETERMINANTS OF COUNTRY’S PARTICIPATION IN GLOBAL VALUE CHAINS: CORRELATION AND REGRESSION ANALYSIS

Iryna Kravtsova

Abstract


The article deals with the problem of identification of the determinants of country’s participation in global value chains. Two main approaches to the study of this issue are revealed; a) based on gravity model of international trade; b) based on correlation and regression analysis. The author applies correlation and regression analysis to identify the factors that have an impact on global value chains participation index. The initial regression model includes 76 independent variables representing structural characteristics of economy and potential areas of state policy, covering the period of 1995-2011 for 63 countries. The evidence indicates that the variance of global value chains participation index is partially explained by structural factors, such as country’s market size, industrial structure, natural resource endowment, that can’t be influenced in the short and medium run. Meanwhile, some policy factors also have an impact on country’s participation in global value chains, in particular, in trade, social, innovation and monetary policy areas.


Keywords


global value chains; value added; international fragmentation of production; international trade in value added; structural characteristics of economy; state policy

References


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Copyright (c) 2017 Iryna Kravtsova

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ISSN (Print) : 2449-7320

ISSN (Online) : 2449-8726