The effect of value chain importance on regional economic recovery

ABSTRACT

This paper investigates the link between value chain importance and economic growth for the EU24 regions between 2008 and 2018. It finds that relying more on GVCs worsened regional growth during the financial crisis, but led to higher growth in the long run. The results contribute to the literature on regional resilience and the public debate on the impact of shocks and the desirability of GVCs. Furthermore, by separately analyzing the importance of global and regional value chains it contributes to the discussion on the effect of regionalization and provides insights on how the re-configuring of value chains may affect regional growth.

KEYWORDS:

• Regional economic resilience
• global value chains
• GVC importance
• economic crisis

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 To avoid inflation bias we calculate proportional measures from the EUREGIO data.

2 These test are not included in the Appendix but are available on request.