2023/10 | LEM Working Paper Series | ||||||||||||||||
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Weak sectors and weak ties? Labour dependence and asymmetric positioning in GVCs |
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Lorenzo Cresti and Maria Enrica Virgillito |
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Keywords | |||||||||||||||||
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Input-output; global value chains; international division of labour; dependency theory.
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JEL Classifications | |||||||||||||||||
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F16, F6, J24, L6, O14
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Abstract | |||||||||||||||||
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Focusing on labour requirements incorporated into GVCs, in the following, we develop a
novel, non conventional measure of learning capabilities, represented by knowledge embodied
along the division of labour within global production networks. In order to capture the division
of labour, and the ensuing division of embodied knowledge, we move from monetary flows of
production, or value-added embodied, to labour embodied in the I-O linkages. We focus on
mature economies as offshoring has been particularly in place there. After constructing a new
indicator of Bilateral Net Labour Dependence, we estimate its relationship with a measure of
performance of industries, namely, labour productivity, seeking to challenge the established
findings generally reporting a positive effect of GVCs participation for sector-level productivity.
Our conjecture is that being in a weak position in terms of (net) labour provision results in an
overall weakening of the capabilities of the loosing productive structure. We corroborate the
conjecture with a panel analysis of OECD countries and industries for the time period 2000-2014.
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