ANALYSIS OF GLOBAL VALUE CHAIN PARTICIPATION AND WORKERS’ WAGES IN THAILAND: A MICRO-LEVEL ANALYSIS

Abstract

This study examines the relationship between global value chain (GVC) participation and workers’ wages and the disparities in wage benefits from GVC participation. It employs a pseudo-panel approach to treat endogeneity biases, utilizing pseudo-panel data constructed from the Thai Labour Force Survey, 1995–2011. The results show that GVC participation, on average, induces higher hourly wages through forward and backward linkages. Although forward linkages inclusively and positively affect workers’ wages, the wage benefits of backward linkages accrue to particular demographic groups. Therefore, government policies must be designed to promote GVC participation, particularly forward linkages, and support disadvantaged demographic groups facing disproportionate wage effects.