The past four decades have seen a large increase in trade via Global Value Chains (GVCs) as well as the relative demand for skilled labour. This thesis centres around the question how the former influences the latter. It firstly describes the large theoretical and empirical ambiguity that exists in the literature before proposing a novel graphical exposition of the channels by which GVCs affect the relative demand for skilled labour. This graph can synthesize the literature and show how small changes in microeconomic foundations can crucially alter predicted outcomes, greatly reducing theoretical ambiguity. It can also serve as a conceptual framework for empirical analysis which should remain the key method to analyse the research question.Therefore, Chapters 2 and 3 employ micro and macro level data, respectively, and condition their results on the conclusions drawn from this conceptual framework. In line with that framework, this thesis finds that the relative skill abundance of the countries engaged in the GVC, which is used as a proxy for the factor bias of the GVC activity, crucially determines the results. On the other hand, the skill intensity of the sector that engages in GVCs does not seem to affect the results. This can best be interpreted in that GVCs allow (firms within) countries to specialise in their comparative advantage at an even more granular level than before, i.e. in the production of intermediate goods or tasks, rather than final goods.Finally, Chapter 4, rather than looking at the effects of GVCs, looks at some of the causes. While formal tariffs have been going down, allowing the expansion of GVCs, non-tariff measures (NTMs) have increased. Chapter 4, however, finds that these NTMs do not significantly affect the export values of goods within that same value chain.
|Date of Award||1 Oct 2015|
- University Of Strathclyde
|Supervisor||Julia Darby (Supervisor)|