The objective of this study is to analyze the impact of energy consumption and competitiveness on countries’ participation in global value chains (GVCs). The two-stage dynamic panel method is applied to data from 35 developing and 28 transition countries over the period 2000-2018. The empirical results of the study reveal that an improvement in competitiveness by one percentage point increases GVC participation, upstream and downstream participation by 0.003, 0.002, and 0.006 points respectively for developing countries. For transition countries, that improvement increases GVC participation, upstream and downstream participation by 0.238, 0.181 and 0.058 points respectively. It also emerges that competitiveness positively affects GVC participation. Finally, the results highlight that energy consumption and intensity positively affect GVC participation. The study highlights the importance of energy and competitiveness in improving developing and transition countries’ participation in global value chains.
KeywordsGlobal Value ChainsCompetitivenessEnergyGMM in System
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