An empirical study on the relation between global value chain governance intensity and technological innovation performance

In the light of global value chain (GVC) governance theory and social capital theory, we claim that the relationship between the governing enterprise and governed enterprise in the value chain is the external social capital of an enterprise, and advance a new concept, GVC governance intensity, to measure it. We aim at disclosing how different governance intensity affects technological innovation performance of enterprises in developing countries which have entered the GVC. To this end, we first construct a conceptual model in which GVC governance intensity influences technological innovation, then raise the research hypotheses, and make empirical analysis of the sample data of textile and apparel enterprises in Shandong province of China. The outcome shows that technological innovation performance is influenced by GVC governance intensity, and their correlation may be illustrated in the shape of a transverse "S". That is, as GVC governance intensity increases, enterprises' technological innovation performance will decrease to start with, increase then and decrease again. The conclusion will help enterprises of developing countries to enhance technological innovation performance by making use of GVC governance intensity effectively.