UNU-MERIT Working Papers Series

Do global value chains and local capabilities matter for economic complexity in EU regions?

R. Boschma, E. Hernández-Rodríguez, A. Morrison & Carlo Pietrobelli #2025-002

This paper combines insights from the literatures on Global Value Chains (GVC), Economic Complexity and Evolutionary Economic Geography to assess the role of GVC participation and regional capabilities in fostering economic complexity in EU NUTS-2 regions. Our results suggest there is no such thing as a common path towards economic complexity across EU regions. Low-income regions manage to benefit from both regional capabilities and GVC participation. In contrast, high-income regions rely more on their existing local capabilities rather than on GVC participation.

JEL Classification: B52, F23, O19, O33, R10

Keywords: Economic complexity, evolutionary economic geography, global value chains, relatedness, economic upgrading, EU regions

DOI: https://doi.org/10.53330/BAGR7168

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