Global Supply Chains, Value Added and Production Intensity: Case Semiconductors

Harald Holmström; Martin Kenney; Timo Seppälä

Global Supply Chains, Value Added and Production Intensity: Case Semiconductors

Harald Holmström, Martin Kenney, Timo Seppälä

Department of Industrial Engineering and Management

Research output: Working paper › Professional

Abstract

Semiconductor chips and their production are foundational for future innovation, future developments of digitalization, and economic prosperity. However, the role of production when discussing who is creating and capturing value across different industrial supply chains has often been underestimated. In this report, we analyze the distribution of the value added in the semiconductor supply chain. Value added analysis is insufficient on its own to understand the importance of production; therefore, we also examine the share of operating profits that has been reinvested in the growth of tangible and intangible assets. Based on value added and reinvesting cycle analysis, we discuss production intensity, and we draw conclusion regarding how important production is for different supply chains and industries.

Original language	English
Publisher	Research Institute of the Finnish Economy ETLA
Number of pages	14
Publication status	Published - 21 May 2021
MoE publication type	D4 Published development or research report or study

Publication series

Name	ETLA Reports
Publisher	ETLA - The Research Institute of the Finnish Economy
Volume	113
ISSN (Print)	2323-2447
ISSN (Electronic)	2323-2455

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

Cite this

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AU - Kenney, Martin

AU - Seppälä, Timo

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AB - Semiconductor chips and their production are foundational for future innovation, future developments of digitalization, and economic prosperity. However, the role of production when discussing who is creating and capturing value across different industrial supply chains has often been underestimated. In this report, we analyze the distribution of the value added in the semiconductor supply chain. Value added analysis is insufficient on its own to understand the importance of production; therefore, we also examine the share of operating profits that has been reinvested in the growth of tangible and intangible assets. Based on value added and reinvesting cycle analysis, we discuss production intensity, and we draw conclusion regarding how important production is for different supply chains and industries.

UR - https://www.etla.fi/julkaisut/global-supply-chains-value-added-and-production-intensity-case-semiconductors/

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BT - Global Supply Chains, Value Added and Production Intensity: Case Semiconductors

PB - Research Institute of the Finnish Economy ETLA

ER -

Global Supply Chains, Value Added and Production Intensity: Case Semiconductors

Abstract

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