In this study we explore the relationship between the adoption of digital technologies and firms' participation in global value chains (GVCs). Using a sample of Spanish manufacturing firms for 2006-2018, we analyse the impact of digitalization on firms' participation in GVCs and its intensity. We construct a general synthetic index of digitalization at the firm level, but also distinguish between information and telecommunication technologies (ICTs) and automation. We consider both the direct effects of digitalization, and the indirect effects that arise from its impact on productivity. Our results suggest that digitalization is a key driver of firms' participation in GVCs. We find evidence supporting both a positive direct and indirect effect of digitalization on GVC participation. The direct effect is to a higher extent attributable to the use of ICT technologies rather than to automation technologies. By contrast, only automation has a positive direct effect on GVC intensive margin.
