Navigating digitalization and global value chains: Empirical insights from the Chinese manufacturing industry

In a rapidly digitalized and globalized world, enterprises understand how digitalization shapes the global value chain (GVC) to remain competitive. Previous studies have examined digitalization, trade openness, research and development (R&D) investment, foreign direct investment (FDI), and infrastructure quality, leaving a gap in understanding the integrated determinants of GVC. This study aims to fill this research gap by examining the integrated impact of digitalization on GVC. Unlike previous studies, this study develops a holistic framework that captures a multidimensional analysis of the interaction between digitalization and GVC participation. This study used panel data models to achieve the desired outcomes from China's manufacturing sector, and the results were obtained using Machine Learning Techniques. This study shows that manufacturing, domestic and foreign digitalization, research and development, productivity, and GVC participation all improve a GVC's position; however, foreign direct investment hampers this improvement. Trade openness, financial growth, and infrastructure all positively impact the relationship between digitalization and the GVC position. By explicitly integrating digital technologies with broader economic and institutional factors, these findings offer a comprehensive understanding of the drivers of GVC competitiveness and provide actionable insights for the manufacturing sectors of emerging economies undergoing rapid digital transformation.