Value chain integration and the political economy of trade liberalization
Increased economic interdependence and integration in a globalized era have seen a fundamental change in the nature of production. Countries are increasingly specializing in and adding value to different stages of production for different goods and services. Such a process of value chain in...
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| Format: | Theses and Dissertations |
| Language: | English |
| Published: |
2015
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| Online Access: | http://hdl.handle.net/10356/65020 |
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| Institution: | Nanyang Technological University |
| Language: | English |
| Summary: | Increased economic interdependence and integration in a globalized era have seen a
fundamental change in the nature of production. Countries are increasingly
specializing in and adding value to different stages of production for different goods
and services. Such a process of value chain integration have created a complex web of
Global Values Chains (GVCs) that span the world. At the same time, there has been a
global movement towards trade liberalization. Why have countries liberalized trade as
they become more integrated in GVCs? I argue that value chain integration alters firm
preferences towards being less protectionist, who then lobby and influence politicians
to make trade policy more open. In short, value chain integration causes trade
liberalization. Using a quantitative study, I show strong but partial evidence for my
central claim. With increasing value chain integration, liberalization occurs in 2 out of
3 trade policy instruments. |
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