Trade agreements and participation in global value chains: Empirical evidence from Latin America

The rise of global sourcing implies a heterogeneous relationship between buyers and suppliers regarding the liberalisation scenarios in emerging countries. This paper analyses effect regional trade agreements (RTAs) on participation Global Value Chains Latin American countries 1995 2015. We combine framework gravity equations with value-added, applying Pseudo Poisson Maximum Likelihood (PPML) estimator panel data fixed effects to deal endogeneity heteroscedasticity. Heterogeneous estimations show that deepest RTAs reinforce position lower technology-industry suppliers, driven by an extra-regional strategy policy. geography value chains has little industrial upgrading region, reducing development potential. study concludes region's policy could reduce dependent distant partners pay more attention creating shorter as generate local capacities gain competitiveness chains.