Digitalization and technology diffusion in global value chains: A comparative backward–forward analysis of six strategic economies in the digital era

Abstract

This study examines how digitalization shapes the mechanisms of inward and outward technology transfer within global value chains (GVCs). Its originality lies in integrating, within a single comparative framework applied to six strategic economies, the backward and forward dimensions of GVC participation, thereby enabling a joint analysis of the dynamics of technological absorption and diffusion in the digital era. The analysis covers the period 2000–2022 and distinguishes backward participation, defined as foreign value added embodied in domestic exports, from forward participation, measured as domestic value added embodied in foreign exports. Two econometric models are estimated to identify the determinants of technological absorption and diffusion in the digital era. The results show that imports of information and communication technology (ICT)-related goods, digital services, and foreign direct investment inflows are positively and significantly associated with backward participation, underscoring the central role of digital and technological inputs in enhancing inward technology transfer. In contrast, forward participation is associated primarily with exports of digital services and intermediate goods, highlighting the growing importance of knowledge-intensive and data-driven activities in the international diffusion of domestic technological capabilities. The comparative profile of the six economies reveals that advanced countries benefit from strong institutional capacities and mature digital infrastructures, whereas emerging economies integrate into GVCs primarily through technological absorption rather than diffusion. Overall, the findings indicate that digitalization constitutes a structural driver of both channels of technology transfer, reinforcing the dual logic of integration and international projection within digitalized global value chains.