Northern European Countries in Modern Global Value Chains: Comparative Analysis

This article dwells upon the comparative aspects of Northern European countries’ participation in modern global value chains (GVCs). The aim of the research was to identify economic sectors in which the analysed countries maintain the most beneficial position in GVCs. Methodology applied is based on the calculation of the vertical specialisation indices and indicators of centrality and clustering in international production networks. New indices of relative GVC specialisation, namely GVC participation intensity index and deviation index, were introduced and applied by the author. Quantitative assessment of the network metrices is based on a construction of the international production network graph. The nodes represented 76 world largest economies and the edges were non-negative normalised quantities of intermediate products interflows. The main source of raw data is the OECD Data Explorer statistical database. Geographical scope of research covers Denmark, Norway, Finland, and Sweden. The time period is 2010‒2019, before the COVID-19 pandemics. The results obtained suggest that Northern European countries participate in GVCs differently. Denmark and Sweden are well-positioned at higher stages of the value chain, whereas Norway and Finland occupy lower stages. At the same time, Denmark and Norway display a distinctive specialisation in water transport, Finland specialises in wood and paper manufacturing, and Sweden has a competitive edge in transport manufacturing. Denmark and Sweden are firmer integrated into the international production network, and they cooperate with relatively more influential partners than that of Norway and Finland. It has been unveiled that GVC participation of the two latter countries depends greatly on the state of the global market.

global value chains, Nordic countries, vertical specialisation, international production networks, centrality