They optimally decentralized locations for the production process and services all over the world by seeking economics of scale and 2  See R. Baldwin (2016), The Great Convergence: Information Technology and the New Globalization, The Belknap Press of Harvard University Press, Cambridge, Massachusetts. 3  comparative advantage.
By the middle of the 2000s they had constructed a network of international specialization in a finely meshed pattern, which is called GVCs. The development of IT greatly contributed to the establishment of GVCs. This is because IT enables firms to collectively manage and control a large number of geographically dispersed processes.