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Abstract

This thesis contains three chapters on Global Value Chains (GVCs), the international network of supply chains between firms. The first chapter introduces tools to measure GVC integration and applies these tools to a novel dataset. It shows that trends in GVCs are increasingly driven by developing economies. In addition, it finds that there are significant differences in the integration patterns of developing as opposed to high-income economies but that these differences are becoming smaller. The second chapter provides evidence that an increase in GVC integration leads to higher labour productivity and GDP. The relationship is identified using an instrumental variables approach based on third country trade costs and GVC position indices. Finally, the third chapter examines how existing domestic value chains facilitate the subsequent integration into GVCs. It shows that in the presence of fragmentation and switching costs, domestic value chains lead to more GVC integration except in sectors characterised by high switching and low fragmentation costs.

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