Final answer:
The value chain embodies the progression of adding value to products or services; modern advances have enabled its fragmentation across global locales, fueling specialization and economic benefits.
Step-by-step explanation:
The value chain refers to the sequence of business functions where value is added to products or services at each stage of the production process. Instead of a single factory handling all aspects of production, advancements in communication technology, information sharing, and transportation have allowed for the splitting up the value chain, with different stages of production happening in different locations or even different countries. This aspect of international trade allows for a high degree of specialization, with firms often focusing on very specific parts of the value chain, resulting in economic gains and encouraging innovation within industries—an idea known as intra-industry trade.