Spatial Effects of Participation in Global Value Chains on CO2 Emissions: A Global Spillover Perspective

Using balanced panel data of 62 countries (regions) from 1995 to 2011, we explore the linkage between a country's participation in global value chains (GVC) and its carbon emissions using spatial panel econometric models. We find: First, positive spatial dependency does exist between countries. Second, forward and backward GVC participation has different spatial spillover effects, with the latter causing most of the spillovers. Third, regarding industry heterogeneity, the manufacturing sector generates a stronger spatial spillover than the service sector. High-tech manufacturing sub-industries show stronger spillovers, compared to low-tech sub-industries. Finally, we propose policy suggestions for international relations and environmental governance.

Automated summary

The study found a positive spatial dependency between countries, with forward and backward GVC participation having different spatial spillover effects, with the latter causing most of the spillovers. The manufacturing sector generates a stronger spatial spillover than the service sector, particularly high-tech manufacturing industries.