Abstract: Firms in developing countries often play a secondary role as low-cost producers and suppliers in global value chains during the past decades. How do they catch up and re-embed into the higher value-added activities in global value chains? Although extant literature including global value chain theory, strategic management theory, technology innovation theory and corporate capacity theory has developed a toolbox consisting of industrial upgrading, strategy transformation, organizational transformation, technology upgrading and catch-up, capacity upgrading and the like, they are mainly based on separated theories. As a result, the whole process of enterprise transformation and upgrading in global value chains has been disintegrated and under-explored, awaiting a merger of cross disciplinary efforts. Through systematically collecting and reviewing existing literature both in Chinese and in English, this paper delineates the underlying conception, makes a synthetic review on path selection, low-end locking, influential factors, outcome measurements and influence mechanisms, and points out the future theoretical issues centering on enterprise transformation and upgrading in global value chains. The review provides guidelines and enlightenment on this emerging research topic that has shown high reference to Chinese local firms.

Key words: enterprise transformation and upgrading, embeddedness in global value chains, embedded position, embedded status, enterprises in developing countries