Title: Do backward and forward participation in global value chain matter for competitiveness? A dynamic panel analysis

Authors: Vigneswari Palanimuthu; Normaz Wana Ismail; Chakrin Utit

Addresses: School of Business and Economics, Universiti Putra Malaysia, 43400 Serdang, Selangor Darul Ehsan, Malaysia ' School of Business and Economics, Universiti Putra Malaysia, 43400 Serdang, Selangor Darul Ehsan, Malaysia ' School of Business and Economics, Universiti Putra Malaysia, 43400 Serdang, Selangor Darul Ehsan, Malaysia

Abstract: This paper examines how high-technology global value chain (GVC) integration affects national competitiveness across 11 Asia-Pacific economies from 1995-2022. Using OECD TiVA data and a dynamic pooled mean group estimator, the analysis evaluates total GVC participation and its forward and backward participation components. The results confirm a stable long-run equilibrium relationship between GVC integration and competitiveness. Forward participation exerts the strongest positive effect, followed by backward participation, indicating that upstream, knowledge-intensive positioning generates greater value capture and resilience. Capital accumulation and governance quality significantly enhance competitiveness, while technological distance and foreign direct investment (FDI) show weaker or negative effects. Crisis extensions incorporating the Asian Financial Crisis, Global Financial Crisis, and COVID-19 demonstrate asymmetric impacts, yet the long-run GVC-competitiveness relationship remains intact. The findings suggest that upgrading into high-value segments, supported by strong domestic capabilities, is essential for sustaining long-term competitiveness in the Asia-Pacific region.

Keywords: global value chain; forward participation; backward participation; competitiveness; Asia-pacific; high-technology; pooled mean group; Asian financial crisis; global financial crisis; COVID-19.

DOI: 10.1504/IJTGM.2026.154202

International Journal of Trade and Global Markets, 2026 Vol.22 No.2, pp.132 - 158

Received: 02 Dec 2025
Accepted: 27 Feb 2026
Published online: 16 Jun 2026 *

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