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This editorial takes stock of the importance of public procurement for international business (IB) and the research questions that remain. We argue that, apart from its traditional role of providing public services to citizens, public procurement acts as a demand-led policy instrument in which governments attempt to influence market outcomes by acting as large discretionary buyers and using their purchasing power and administrative processes to obtain policy objectives. We compare various financial and non-financial goals that governments aim to attain with public procurement and how they try to shape IB to achieve these goals. We also develop a framework to analyze how contracting firms and their global value chains adapt their IB strategies to optimize their chance of winning public procurement contracts.

There is clear evidence that existing preferential schemes contributed significantly to boosting least-developed country (LDC) exports (Klasen et al., 2016). Many seem to believe the multilateral trading system could offer little to LDCs as they have already obtained market access to critical markets under the current preferential schemes. Despite the LDCs’ reluctance to positively engage in recent WTO discussions, there is room for the global trading system and new multilateral initiatives to promote the participation of LDCs in global value chains (GVCs). Given that LDC exports are often further processed and ‘travel’ down the GVCs as part of third-country exports still facing tariffs, one could envisage a global preferential scheme based on LDC value-added, i.e., products originating in any WTO members should receive an ‘LDC preferential treatment’ proportionate to the value of LDC’s inputs content embodied in their exports, whenever exported to any other WTO member. We conceptualize this new ‘GVCs for LDCs’ proposal and estimate its economic potential using a dynamic Computable General Equilibrium (CGE) modelling framework. If LDC preferential market access is changed from the simple ‘direct export’ approach (e.g., the Generalised Scheme of Preferences (GSP)-like schemes currently in operation) to a GVC approach, LDC exports would receive a considerable boost (a 2.5% annual increase worth over USD 10 billion per year) and increased market premium for their products.

To various degrees, Central and Eastern European countries increased their participation to the world economy over the last ten years. In particular, they accepted the challenge of trade openness and attracted significant foreign direct investment. This paper assesses the impact of these major changes on output growth in this region. Results of a panel data analysis suggest that increased EU integration and openness as well as reduced import duties were favourable to development. There is also evidence that increased FDI inflows may be associated with better output performances.