Firm-level evidence on the reconfiguration in global value chains
DOI:
https://doi.org/10.24136/ceref.2026.006Keywords:
offshoring, backshoring, reshoring, global value chain, multinational enterpriseAbstract
Business evidence suggests that many multinational enterprises (MNEs) consider new investment projects in their home economies to balance their dependence on global sourcing due to dynamic geopolitical shifts. The research goal of this article is to investigate and explain changes in international configuration of MNEs during a period of time 2012-2021. Using firm-level data I measure the dynamics in the global structure of sourcing arrangements with respect to fixed assets and employment of multinational enterprises in domestic versus foreign subsidiaries. The sample of firms consists of 17,869 foreign subsidiaries, including 15,462 nearshore and 2,407 farshore units. I aim at contributing to the economic literature in two ways. The first one is providing empirical evidence regarding changes to global value chains (GVCs) with respect to operations of firms. The second novelty is applying data on structures of MNEs influencing their operations with respect to GVCs. From the micro perspective, the results suggest that that international organization of production is stable. It means that firms do not shift production from one location to another in response to short-term events. It can be explained by high fixed costs of establishing foreign operations. From the macro perspective, this study provides particularly valuable insights in the current context of protectionist policies introduced in the global economy. The results confirm limited transfer of jobs and investment into home economies of MNEs.
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