The Impact of Trade Invoicing Decisions on Global Value Chain Participation: An Empirical Analysis

This paper studies how exchange-rate movements interact with dominant currency invoicing to shape global value chain participation across production stages.

Using data from 96 countries over 1990-2020, the analysis shows that dominant-currency trade is especially sensitive to exchange-rate movements: dollar appreciation dampens GVC participation, particularly backward participation, while invoicing structure changes the magnitude of these effects.