Executive Summary

The theme of the Global Value Chain Development Report 2021 is Beyond Production. Most research on global value chains (GVCs) focuses on manufacturing production; in other words, the breaking up of production processes into many discrete steps with a resulting explosion of trade in parts and components. But there are aspects of GVCs that go beyond manufacturing processes; in fact, value added and employment generation in GVCs are depending less and less on manufacturing production. This year’s report features research on these aspects. For example, by highlighting the role of multinational corporations (MNCs) and, closely related to that, the role of intellectual property (IP) in setting up GVCs. Value chains are an efficient way for firms to exploit their brands, patents, and other IP. In the extreme, this leads to “factoryless” production in which firms that design and market manufactured products own none of the production process. An important part of modern GVCs consists of innovator countries exporting the services of their IP in return for manufactured goods.