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Joint foreign ownership and global value chains effects on productivity: a comparison of firms from Poland and Germany
Abstract
Purpose The study aims to examine the joint effects of foreign ownership (FO) and involvement in global value chains (GVCs) on the productivity performance of firms from a catching-up country (Poland) and a leader economy (Germany). Design/methodology/approach The authors use micro-level data on firms combined with several sector-level GVC participation measures. The authors investigate whether the link between productivity and the overall sectoral degree of involvement in global production structures depends on a firm's ownership. The authors verify the robustness of the obtained results by using an instrumental variables approach and weighted regression. Findings The results show that domestically owned firms are less productive than foreign ones, which is particularly true at low GVC participation levels. However, as GVC involvement increases, the FO productivity premium decreases, leading to productivity catching up between foreign and domestically owned firms. This mechanism is similar in Poland and Germany. However, in the leader country (Germany), the productivity performance of domestically owned firms is more stable along the distribution of GVC involvement. Originality/value This study contributes to the foreign direct investment (FDI)–productivity literature by comparing the catching-up and developed countries' perspectives and incorporating the productivity–GVC relationship into the FDI analysis. The authors show that the FO premium is not confined to the developing context but is also present in a leader country. Moreover, the link between productivity and the overall sectoral degree of involvement in global production structures depends on a firm's ownership.
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- Publication version
- Accepted or Published Version
- DOI:
- Digital Object Identifier (open in new tab) 10.1108/ijoem-09-2022-1357
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- Category:
- Articles
- Type:
- artykuły w czasopismach dostępnych w wersji elektronicznej [także online]
- Published in:
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International Journal of Emerging Markets
ISSN: 1746-8809 - Language:
- English
- Publication year:
- 2023
- Bibliographic description:
- Szymczak S., Parteka A., Wolszczak-Derlacz J., Joint foreign ownership and global value chains effects on productivity: a comparison of firms from Poland and Germany, International Journal of Emerging Markets, 2023,10.1108/ijoem-09-2022-1357
- DOI:
- Digital Object Identifier (open in new tab) 10.1108/ijoem-09-2022-1357
- Sources of funding:
- Verified by:
- Gdańsk University of Technology
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