Carbon neutrality along the way to participate in global value chains: the threshold effect of information globalization of BRICS countries

Abstract

Using panel data from BRICS countries over the period 2000 to 2018, a multi-variate threshold model was built to investigate how global value chain (GVC) participation and information globalization affects CO2 emission. We further decompose the information globalization into two indicators, i.e., de facto measure and de jure measure. The main findings show that the estimated value of threshold is 4.02 and 1.81 for both de facto and de jur measures of information globalization. The findings suggest that information globalization rate above the threshold level negatively affects the carbon emissions. De facto and de jure measures show a strong single threshold effect when GVC participation is chosen as the major explanatory variable. Similarly, participation in GVCs has a large single threshold impact when information globalization is taken as the primary independent variable. Overall, the results show that the larger the information globalization for the countries under analysis, the modified impact of GVC participation on CO2 emission reduction is larger. The robustness test validates the stability and coherence of the study’s findings. The opportunities that the information globalization along the approach to participate in GVCs presents for the accomplishment of carbon neutrality should be properly utilized by policymakers. There should be expansion the participation in GVCs with digital infrastructure and to enhance the assessment system for the use of technology spillover effects to increase environmental-friendly GVC ladder.