Transnational Capitals and Industrial Chain Upgrading

Industrial chain upgrading usually shows that the local cluster enterprises operates ascending from low added-value segments to the high ones by means of OEM or supporting MNCs. The technology, brands and channels from MNCs serves as prerequisite for upgrading to high value-added segments. The paper constructs a two-stage optimization model of industrial supporting and upgrading to illustrate that the cluster enterprises in the first stage can obtain independent innovative capacity by building perfect supporting system and integrating with transnational capitals, while in the second stage they can enhance their regional competitiveness by out breaking low-added value segments and upgrading along value chains.