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The paper aims at addressing the following research questions: does institutional quality improve countries' environmental efficiency? And which pillars of institutional quality improve countries' environmental efficiency?

By specifying a directional distance function in the context of stochastic frontier method where GHG emissions are considered as the bad output and the GDP is referred as the desirable one, the work computes the environmental efficiency into the appraisal of a production function for the European countries over three decades.

According to the countries' performance, the findings confirm that high and upper middle-income countries have higher environmental efficiency compared to low middle-income countries. In this environmental context, the role of institutional quality turns out to be really important in improving the environmental efficiency for high income countries.

This article attempts to analyze the role of different dimensions of institutional quality in different European countries' performance – in terms of mitigating GHGs (undesirable output) – while trying to raise their economic performance through their GDP (desirable output).

1. The paper aims at addressing the following research question: does institutional quality improve countries' environmental efficiency?

2. We adopt a directional distance function in the context of stochastic frontier method, considering 40 European economies over a 30-year time interval.

3. The findings confirm that high and upper middle-income countries have higher environmental efficiency compared to low middle-income countries.

4. The role of institutional quality turns out to be really important in improving the environmental efficiency for high income countries, while the performance decreases for the low middle-income countries.

The paper aims at addressing the following research question: does institutional quality improve countries' environmental efficiency?

We adopt a directional distance function in the context of stochastic frontier method, considering 40 European economies over a 30-year time interval.

The findings confirm that high and upper middle-income countries have higher environmental efficiency compared to low middle-income countries.

The role of institutional quality turns out to be really important in improving the environmental efficiency for high income countries, while the performance decreases for the low middle-income countries.

In this paper, we evaluated the impact of the US “Chip Act” on the participation of the Chinese electronics industry in the global value chain based on the dynamic CGE model. This is a meaningful attempt to use the GTAP-VA model to analyze the electronics industry in China.

We employ a Dynamic GTAP-VA Model to quantitatively evaluate the economic repercussions of the “Chip Act” on the Chinese electronic industries' GVC participation from 2023 to 2040.

The findings depict a discernible contraction in China’s electronic sector by 2040, marked by a −2.95% change in output, a −3.50% alteration in exports and a 0.45% increment in imports. Concurrently, the U.S., EU and certain Asian economies exhibit expansions within the electronic sector, indicating a GVC realignment. The “Chip Act” implementation precipitates a significant divergence in GVC participation across different countries and industries, notably impacting the electronics sector.

Through a meticulous temporal analysis, this manuscript unveils the nuanced economic shifts within the GVC, substantially bridging the empirical void in existing literature. This narrative accentuates the profound implications of policy regulations on global trade dynamics, contributing to the discourse on international economic policy and industry evolution.

We evaluated the impact of the US “Chip Act” on the participation of the Chinese electronics industry in the global value chain based on the dynamic CGE model. This is a meaningful attempt to use the GTAP-VA model to analyze the electronics industry in China.

The interaction between policy regulations and global value chain (GVC) dynamics is pivotal in understanding the contemporary global trade framework, especially within technology-driven sectors. The US “Chips Act” represents a significant regulatory milestone with potential ramifications on the Chinese electronic industries' engagement in the GVC.

The significance of this paper is that it quantifies for the first time the impact of the US Chip Act on the GVC participation index of East Asian countries in the context of US-China decoupling. With careful consideration of strategic aspects, this paper substantially fills the empirical gap in the existing literature by presenting subtle economic changes within GVCs, highlighting the profound implications of policy regulation on global trade dynamics.