GVCs Embeddedness and Its Effects on Industrial Productivity: Evidence from Turkish Manufacturing Industries

Abstract

This study examines the impact of global value chain (GVC) embedding degree and position on productivity in Turkish manufacturing industries from 2003 to 2018 using a two-step system generalized method of moments (GMM). It explores variations in these effects between low-tech and high-tech industries. Results indicate a significant positive productivity effect for low-tech industries and an insignificant effect for high-tech and overall manufacturing industries. Furthermore, our findings suggest that embedding position has limited effects in all three contexts. This study reveals a statistically significant productivity impact of FDI, financial development, subsidies, and openness for overall manufacturing industries, with significant positive effects observed only for FDI and trade openness in low-tech and high-tech industries.