The Benefits Distribution Of The Global Value Chains Specialization

The Global Value Chains Specialization is an international specialization mode, in which a product is continuously produced in more than one country or region, with importing of some intermediate products and exporting of the final products. It is a new feature of the international work division under the circumstance of economy globalizing and condition of Knowledge Economy. It is also an important trend of contemporary international specialization of labor.The Global Value Chains Specialization has deepened the mode of international specialization. It has been changed from various products specialization to procedures or value chains specialization. National boundary of traditional division is fading out. The subject of specialization is transformed from countries to enterprises. It has also integrated the comparative advantages of different countries. The national comparative advantages in traditional division have been evolved into international comparative advantages. During the changing of international division structure, the interest growth mechanism of international trade and how it was distributed between different countries, become confusing. The multinational enterprises may hurt the benefit of some other countries or even the hosted country for its own better profit. The hosted country may gain the specialization benefit of the global value chains, while losing some benefit of exchanging. The developing countries can promote domestic economy by carrying on some industries that transformed from developed countries, but which could decrease the social welfare.The current domestic and foreign studies on the Global Value Chains are mainly focused on the micro subjects such as multinational companies, or medium subjects like industries, industrial cluster of a region. Basic academic study from perspective of macro level or based on analysis of countries is very limited. This paper is based on relative researches, following the basic developing path of the theory of traditional international division and trade, and trying to expand and consummate a part of logical chain of traditional division and trade theory. This part of logical chain has some break points, while explaining the Global Value Chains specialization. The paper is intended to upgrade the study on the Global Value Chains Specialization from the micro level to macro level of world benefit and country benefit.The paper focused on the subject of the Global Value Chains Specialization, discussing on the basis and profit separation of the Global Value Chains Specialization, how to increase developing countries' benefit, and the academic and practical issues of China's strategic choices in the system of the Global Value Chains Specialization. There are some issues of the discussion: As the basis of the traditional division, the comparative advantage and economies of scale are still the source of interest of the Global Value Chains Specialization; the interest of the Global Value Chains Specialization is no longer an inseparable whole, but the separation including product-benefit and cost-benefit, benefit of enterprises and countries, benefit of division and exchange, benefit of economy and society; the Global Value Chains Specialization based on comparative advantage would not necessarily be the optimum allocation of resources, but the Global Value Chains Specialization based scale economy will definitely increase the benefit of world economy; the Global Value Chains Specialization can academically increase the economical benefit of the participant countries, but the changing of the benefit is very complicated in fact; within the Global Value Chains, the multinational companies have integrated the comparative advantage of the world, thus gotten the advantage of scale economy, inclined price and implementation of the transfer pricing; the developing countries in the Global Value Chains will generally tend to get economic growth from labor-factor-intensive industries. But if developing countries can take full advantage of their "overlapping elements", and continually optimize their elements structure, they will be able to shorten the gap with the developed countries, and even to catch up with developed countries; Because of the "big power effects", the benefit situation of China in the Global Value Chains Specialization is worrisome: senior factors of production should be increased, to make the company competitive edge, to pursuit dynamic economic benefit, and to safeguard national economic security.Based on analysis of the above issues, this paper drew the following conclusions: First, within the Global Value Chains Specialization, the participants using absolute superior value chain of their products with comparative advantages will always gain their profit. If the participants use absolute superior value chain of product with comparative disadvantage, their profits may suffer. But if the developing countries participate the Specialization with absolute superior value chain of their products with comparative disadvantage, there will always be profit space. Second, for the developing countries, the Global Value Chains Specialization is in the end "comparative advantages traps" or "comparative advantage pie", the key is to see whether the developing countries can full play their own "the advantage of later striking". Thirdly, the "World Factory" under the Global Value Chains Specialization is no longer the same concept as the traditional sense. "World Factory" should not be our ultimate goal, but only an experienced process in our path to world economic powers.The main creative points: First, using the separation of "product-benefit" and "cost-benefit" to prove a long-standing academic debate on unfair exchange issue of traditional trade which based on comparative advantages, and applying the conclusion into the Global Value Chains Specialization. Second, this paper presents the "overlapping elements theories", and from the perspective of supply, it seems to be able to make up the defect of Lindel (S.B.Linder) "overlapping demand theory" while explaining the assumption of trade demand within the industry.To sum up, the generic explanation on the interest situation of the Global Value Chains Specialization which presented by this paper, has not only significant meaning to the theory, but also makes strong sense to practice of developing countries, especially the discussion on industrialization upgrading process of China.