Economic Policy Uncertainty And Global Value Chain

Economic policy is an indispensable part of economic development.Especially since the 2008 financial crisis,many countries have strengthened macroeconomic regulation and control.In response to the downward pressure on the economy during the economic transition period and the changing global economic environment,China has also increased its economic regulation and control,and introduced a series of economic policies with frequent policy fluctuations.Recent years the trade friction between China and the United States has increased,the global economic development faces greater uncertainty,which has a major impact on the cross-border investment of enterprises and the transnational trade of products.Deepening the global value chain and improving the embedded level of enterprises and industry value chains are the primary tasks for each country to participate in the global economic development.Based on the real option theory,this paper analyzes the impact of economic policy uncertainty in the context of the increase of global economic uncertainty caused by Sino-US trade friction.It is found that economic policy uncertainty has embedded in the global value chain of enterprises."Inhibition effect" and "Selection effect".Based on the manufacturing data matching the industrial enterprise database and the customs database from 2000 to 2007,this paper finds through empirical analysis that the improvement of economic policy uncertainty will reduce the global value of the enterprise.As China's manufacturing industry participates in the global value chain,the frequency of friction with trading partners is higher(Yu Zhen etc.al,2018).For China and its trading partners,it is necessary to face up to the "Inhibition effect" of economic policy uncertainty and seek a safe symbiotic approach.Enterprises should use the"selection effect" of economic policy uncertainty to avoid greater loss during economic friction.