Proceedings of the 2nd Business & Management Conference, Madrid

VERTICAL SPECIALIZATION, GLOBAL VALUE CHAINS AND THE CHANGING GEOGRAPHY OF TRADE: THE PORTUGUESE RUBBER AND PLASTICS INDUSTRY CASE

JOÃO LOPES, ANA SANTOS

Abstract:

The growing fragmentation of production in the last decades has changed the geography, and dynamics, of trade. It is very important, especially for small and open economies, a good position in regional and global value chains (GVC). The necessary increase in imports, namely of intermediate inputs, that this positioning implies must be accompanied by an adequate increase of exports, generating a substantial amount of domestic value added. In this paper, an empirical analysis is made of the changes in the geography of imports and exports of Portuguese rubber and plastics industry, as well as the growing vertical specialization of this sector, both with direct and total measures, in the period 1995-2011. To put the main trends in perspective, a comparison will be made with some northern and southern EU countries, the main trade partners of Portugal in this industry, and in fact in all the others. The rubber and plastics industry is a good case study in the context of GVC analysis, given the strong proportion of intermediate inputs in its output and trade.

Keywords: Vertical specialization; Global value chains; Rubber and plastics industry; Portugal

DOI: 10.20472/BMC.2015.002.010

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