Impact of Export Sophistication on Trade Diversification: the Mediating Role of Participation in Global Value Chains
Purpose: The purpose of this study is two-fold: First to investigate the impact of export sophistication and participation in global value chains (GVCs) on trade diversification, and: Second, to examine the nonlinear relationship between export sophistication and trade diversification under the in...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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CSRC Publishing
2022-06-01
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| Series: | Journal of Business and Social Review in Emerging Economies |
| Subjects: | |
| Online Access: | https://publishing.globalcsrc.org/ojs/index.php/jbsee/article/view/2363 |
| Summary: | Purpose: The purpose of this study is two-fold: First to investigate the impact of export sophistication and participation in global value chains (GVCs) on trade diversification, and: Second, to examine the nonlinear relationship between export sophistication and trade diversification under the influence of GVCs.
Design/Methodology/Approach: For this, the current study constructed a panel of 105 economies covering the period 2011-2018. For empirical analysis, this study applies the static panel threshold test proposed by Hansen (1999).
Findings: According to the results of this study, export sophistication and participation in global value chains have a positive association with trade diversification. In addition, this study finds 2 thresholds of GVCs that divide the impact of export sophistication on trade diversification into three regimes. Therefore, the relationship between export sophistication and trade diversification is nonlinear.
Implications/Originality/Value: Therefore, this study suggests countries to produce sophisticated products and increase their participation in global value chains.
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| ISSN: | 2519-089X 2519-0326 |