An implementation of climate-related financial policies to promote a nation’s participation in global value chains: evidence from an international database
Asia Pacific Journal of Marketing and Logistics
ISSN: 1355-5855
Article publication date: 29 January 2024
Issue publication date: 10 July 2024
Abstract
Purpose
This study aims to investigate two issues: (1) a nexus between climate-related financial policies (CRFP) and global value chains (GVC) and (2) the government’s policies to help countries enhance the efficient use of CRFP in improving a country’s likelihood to participate in GVC.
Design/methodology/approach
To investigate the connection between GVC and CRFP, the authors incorporate that backward participation is measured using foreign value-added, while domestic value-added is used to measure forward participation, quantified as proportions of gross exports. The study analyses yield significant insights across a span of 20 developing countries and 26 developed countries over the period from 2010 to 2020.
Findings
Regarding the first issue, the authors affirm the presence of a linear link between GVC and CRFP, implying that involvement in CRFP is advantageous for both backward and forward participation. Furthermore, the authors identify long-term GVC and CRFP cointegration and confirm its long-term effects. Notably, the expression of a linear relationship between GVC and CRFP appears to be stronger in developing countries.
Research limitations/implications
The study findings, together with previous research, highlight the importance of financial policies relating to climate change (CRFP) in the context of economic growth. Climate change’s consequences for financial stability and GVC highlight the importance of expanded policymakers and industry participation in tackling environmental concerns.
Practical implications
Regarding the second issue, the study findings suggest critical policy implications for authorities by highlighting the importance of financial stability and expanded policymakers in promoting countries' participation in GVC.
Originality/value
This paper investigates the link between GVC performance and CRFP, offering three significant advances to previous research. Moreover, as a rigorous analytical method, this study adopts a typical error model with panel correction that accounts for cross-sectional dependency and stationarity.
Keywords
Acknowledgements
This paper was supported by National Economics University.
Citation
Hà, L.T. (2024), "An implementation of climate-related financial policies to promote a nation’s participation in global value chains: evidence from an international database", Asia Pacific Journal of Marketing and Logistics, Vol. 36 No. 7, pp. 1674-1696. https://doi.org/10.1108/APJML-10-2023-1047
Publisher
:Emerald Publishing Limited
Copyright © 2024, Emerald Publishing Limited