Financing Agency: National Science Centre, Poland
Duration period: 11.07.2016 – 10.07.2021
Project number: UMO-2015/19/B/HS4/02884
Type of the project: OPUS
Budget of the project: 442 225 PLN
Summary of the project
This research focuses on the effects of global production networks (GPN) on the performance of firms and workers. The concept of GPN is strongly linked to that of global value chains (GVC) and trade in value added (TiVA). The proliferation of global production networks has altered fundamentally the geography and complexity of global production (Baldwin 2012, 2014; OECD, 2013; Timmer et al., 2014; Johnson, 2014), affecting labor markets of both developed and developing countries (Stone and Bottini, 2012; Shepherd and Stone, 2013; Shepherd, 2013). Main aim of the research project is to assess microeconomic consequences of GPN in terms of changes in employment, earnings and resource allocation. Within the project we shall discuss separately effects on employment, wages and factor allocation, breaking out the results according to the skill level of workers, tasks specificity and firm characteristics. Multicounty perspective of analysis will be adopted.
The project is mainly empirical in nature, even though we also plan to elaborate on the theoretical side of the analyzed phenomena. Specifically we want to present a parsimonious theoretical model(s) describing implications of global production sharing on individual workers and to build empirical model(s) based on the predictions of the new-new trade theory linking the international involvement of firm (importing/exporting/foreign direct investment/involvement in GVC) with productivity gains stemming from factor reallocation. Given very complex nature of possible implications of global production sharing on labour markets, we formulate a number of detailed empirical hypothesis. They are connected with the consequences of GPN on risk of losing job (e.g. depending on the typology of performed task - routine vs non-routine), losses of wages and changes in firm productivity. We also want to test whether effective labour market institutions smooth out possible negative effects of global division of production on employment and earnings and to accelerate the adjustment process.