Finance

Business

International trade

Value (mathematics)

Mathematics

Biology

Operating system

Machine learning

Position (finance)

Economics

Ecology

Geometry

Global value chain

Measure (data warehouse)

Computer science

Comparative advantage

Product (mathematics)

Process (computing)

Industrial organization

Database

Added value

Competition (biology)

Economic Systems Research

A key question for promoting international competition is how to improve the position of countries and industries in global value chains (GVCs). The first step is to properly measure industrial upgrading in GVCs. This is not a trivial issue because upgrading has not been defined unambiguously. Several authors have used different (and sometimes related) measures, all of which indicate certain aspects of upgrading. Rather than trying to find the single, ultimate measure of upgrading, we propose a different approach. We examine the multidimensionality of industrial upgrading, using eight indicators in factor analysis. Four of the eight indicators adopt the GVC perspective and include, for example, the growth of the share in value-added exports. We provide three quantitative dimensions of industrial upgrading: process upgrading, product upgrading, and skill upgrading. With these dimensions, we compare and analyze the upgrading of different countries and industries using the World Input–Output Database.

Measuring industrial upgrading: applying factor analysis in a global value chain framework