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Owing to globalisation‐induced fragmentation of production across regions and reorganisation of global value chains (GVCs), more attention is being paid to the impact of deep preferential trade agreements (PTAs) on GVC participation. We examine how the promotional effect of deep trade agreements on GVC participation changes with GVC production position distance between member countries. We argue that...
We examine, both theoretically and empirically, how the presence of FDI affects product quality of domestic firms through worker mobility. Mobility of more productive workers from foreign‐invested to domestic firms lowers the cost of production and contributes to improvement in the quality of goods produced by domestic firms. Profit maximisation by firms yields a structural relationship between unobserved...
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