Indicators which have been developed within the context of trade in value-added are, for instance, the import content of exports, value-added induced by export, or value-added induced by unit of export. Indicators help to identify the value-added of international trade, in particular the contribution of global value chains to economic growth, employment, productivity, labor compensation, research and development, and technological innovation. These indicators shed new light on financial, technological and trade interdependencies.
The full list of all available publications related to "Indicators for International Trade and Economic Globalization" can be found HERE.
The Canadian apparel has long been considered a global player. For years, many Canadian companies have been producing offshore and have seized on preferencial access to United States (US) markets to export their products. However until recently, the Canadian apparel industry also operated under protectionism that allowed it to thrive within North America… more »
It is increasingly rare that a good or a service is entirely produced at one location and then exported to a final consumer. Rather, production of a good or even service involves an increasingly complex process with intermediate inputs and supporting activities sourced globally from wherever it is most efficient to do so. These complex international production arrangements have come to be known as global value chains (GVCs)... more »
We study how the rise of trade in services with China and India has impacted U.S. labour markets. The topic has two understudied aspects: it deals with service trade (most studies deal with manufacturing trade) and it examines the historical first of U.S. workers competing with educated but low-wage foreign workers. Our empirical agenda is made complicated by the endogeneity of service imports and the endogenous sorting of workers across occupations... more »
This paper applies global value chain analysis to study recent trends in the global automotive industry. The authors pay special attention to the effects of the recent economic crisis on the industry in developing countries. The principal finding is that the crisis has accelerated precrisis trends toward greater importance of the industry in the South. More rapid growth of car ownership is the impetus, but the co-location and close interaction of suppliers and lead firms in this industry is an important catalyst… more »
The automotive industry is Canada’s most important manufacturing and export sector. In 2005, Canada’s automotive industry employed 7.7 percent of the manufacturing workforce and accounted for nearly a third of manufactured goods exports. Canada’s twelve high-volume final assembly plants directly employed more than 51,000 workers.More than two and a half million vehicles were produced, valued at $69.8 billion, of which nearly 85% was exported… more »
2009 was a landmark year. The global economy suffered the worst downturn since the Great Depression of the 1930s, enduring dramatic shifts in global economic and financial markets in an extraordinarily challenging environment The banking system teetered on the abyss, tested by weak credit markets, a collapse in equity markets, and heightened requirements for liquidity and capital. FromAugust 2008 through mid-2009 output contracted... more »
This paper provides an integrated view of globally engaged US firms by exploring a newly developed dataset that links US international trade transactions to longitudinal data on US enterprises. These data permit examination of a number of new dimensions of firm activity, including how many products firms trade, how many countries firms trade with, the characteristics of those countries, the concentration of trade across firms, whether firms transact at arm’s length or with related parties, and whether firms import as well as export... more »
A great burst of globalization brought the 20th century to a close, creating upheaval in the world economy from roughly 1995 to 2008. And now, with the new century barely commenced, a second upheaval is in the offing following the severe financial crisis that plunged the global economy into recession in 2008-09. The first upheaval witnessed a massive migration of manufacturing and certain business services that transformed Asia into the industrial heartland of the world. The second upheaval will likely consolidate Asia's industrial preeminence and could result in a concentration of industrial activities in the two most populous and fastest growing Asian economies - China and India... more »
The explosive growth of China’s economy has been extraordinary. Between 1990 and 2005, China’s exports increased by 25 times in real terms, compared to an increase of about four times in the 12 largest exporting nations .As of 2005, China’s exports accounted for 25% of the total exports of all countries outside of the top 12… more »
In this paper we argue that the path of economic development for would-be developers has changed fundamentally since the 1980s. Focusing on East Asia, we contend that the path followed by ‘late developers’ has shifted to one that can best be described as ‘compressed development.’ We introduce the notion of compressed development to highlight the new policy dilemmas and choices that developing countries face today, which we characterize as ‘policy stretch.’… more »
What is the Exports Radar? The Exports Radar is an instrument developed by Statistics Netherlands to analyse developments in exports of goods and place them in some sort of context. On the basis of six indicators – selected on the basis of an econometric study - the radar monitors whether circumstances have developed favourably or unfavourably for Dutch exports… more »
This article challenges the commonly cited statistics for engineering graduates in the United States, China, and India. Our research shows that the gap between the number of engineers and related technology specialists produced in the United States versus those in India and China is smaller than previously reported, and the United States remains a leading source of high-quality global engineering talent. Furthermore, engineering graduates in China and India face the prospect of substantial unemployment... more »
This paper provides both a conceptual framework for decomposing a country’s gross exports into value-added components by source and a new bilateral database on value-added trade. Our parsimonious framework integrates all previous measures of vertical specialization and value-added trade in the literature. To illustrate the potential of the decomposition, we present a number of applications including re-computing revealed comparative advantages... more »
This paper provides evidence of the links between Global Value Chains (GVCs) and labour market outcomes, focusing on developing economies. The literature generally indicates that firms with international linkages—which we use here as a proxy for GVC involvement—tend to employ more workers, pay higher wages, and employ more skilled workers than firms that deal exclusively with the domestic market. Our results are consistent with existing evidence found in developed economies, with internationalised firms tending to hire more workers and pay higher wages in developing economies as well... more »
This paper provides a review of the available literature on global value chains (GVCs) and employment markets in developing countries. Due to the difficulty of observing intra-GVC transactions, there is very little direct empirical work on GVCs and labour markets. However, it is possible to extrapolate from the extensive empirical work already undertaken on firm internationalisation and labour markets to draw inferences as to the likely impacts of GVCs. The review therefore focuses on the labour market impacts of three processes that lie at the core of GVC development: importing, exporting, and foreign direct investment (FDI)... more »
The global economic crisis of 2008–09 has revealed the interdependence of the world economy. The financial crisis originated in the United States, but the resulting economic downturn quickly spread to the rest of the world. Trade, along with finance, was one of the main vectors of transmission of the crisis. In 2009, there was a massive contraction in global trade—minus 13 percent. The contraction was largely a reflection of a drop in demand, especially for durable goods… more »
The trade collapse that followed the recent financial crisis has led to a renewed interest on the measurement issues affecting international merchandise trade statistics in the new globalized economy. The international fragmentation of industrial production blurs the concept of country of origin and calls for the production of new statistics on the domestic content of exports... more »
Vietnam has been among the most successful East Asian economies, especially in weathering the external shocks of recent globalization crises—the 1997-98 Asian financial crisis and the 2008-09 great recession, financial crisis and collapse of global trade. Its success contradicts its characterization as an example of export-led growth and highlights the role of the state, particularly in maintaining and influencing investment… more »
This paper presents a critical review of the Global Value Chain literature in light of the “Technological Capabilities” approach to innovation in LDCs. Participation in GVC is beneficial for firms in LDCs, which are bound to source technology internationally. However, the issues of learning and technological efforts at the firm-level remain largely uncovered by the GVC literature… more »
This paper presents evidence of the importance of electronics global value chains (GVCs) in the global economy, and discusses the effects of the recent economic crisis on the industry. The analysis focuses on how information is exchanged and introduces the concept of “value chain modularity.” The authors identify three key firm level actors—lead firms, contract manufacturers, and platform leaders—and discuss their development, or “coevolution” in the context of global integration… more »
This paper aims to develop a storyline for the WPGI/CIIE work on global value chains (GVCs) for the PWB of 2011-2012, by bringing together the empirical evidence and analytical research on GVCs and analyzing new policy issues. The objective of the WPGI activities on GVCs is to develop policy relevant analysis and provide analytical support for the policy discussion in the CIIE. The work on GVCs will be undertaken in close coordination with the work on ‘New Sources of Growth’ given the complementarities between the two projects… more »
As China's export juggernaut employs many imported inputs, there are many policy questions for which it is crucial to know the extent of domestic and foreign value added in its exports. The best known approach - the concept of "vertical specialization" proposed by Hummels, Ishii and Yi (2001) - is not appropriate for countries that engage actively in tariff/tax-favored processing exports such as China, Mexico, and Vietnam. We develop a general formula for computing domestic and foreign contents when processing exports are pervasive… more »
The current global crisis may change globalization itself, as both developed and developing countries adjust to global imbalances that contributed to the crisis. Will these changes help or hinder economic recovery and growth in South Asia? This is the focus of this paper. The three models of globalization--trade, capital, and economic management--may not be the same in the future... more »
Over the last decades the world has witnessed a gradual relocation of manufacturing activities from developed to developing countries, opening up new opportunities for employment, increased income and economic growth for some of the world’s poorer and less developed countries. However, the process of industrialization has not benefitted all developing countries equally. In the 2009 Industrial Development Report… more »
The past decades have witnessed a rapid globalisation of economic activity which has significantly changed the outlook of the world economy. International production, trade and investments are increasingly organised within so-called global value chains (GVCs) where the different stages in the production process are located across different economies. Until now, GVCs have been largely discussed from a conceptual and theoretical view, but empirical work on international fragmentation has stayed a bit behind… more »
The paper investigates the role of global supply chains in explaining the trade collapse of 2008-2009 and the long-term variations observed in trade elasticity. Building on the empirical results obtained from a subset of input-output matrices and the exploratory analysis of a large and diversified sample of countries, a formal model is specified to measure the respective short-term and long-term dynamics of trade elasticity… more »
The global motor vehicle industry is rapidly steering away from the internal combustion engine. Electric vehicles are increasingly attractive for their potential to reduce greenhouse gases and decrease dependence on oil. By 2020, more than half of new vehicle sales will likely consist of hybrid-electric, plug-in hybrid, and all-electric models. For automakers, the key to this huge shift will be lithium-ion batteries… more »
There is broad agreement that the world economy is becoming more deeply integrated and interdependent along multiple dimensions: economic, cultural and political. While one might expect cultural or political integration to be difficult to measure with precision, global economic integration has also proven resistant to detailed quantification and empirical characterization. We have a strong sense of profound changes in the world economy... more »
As the term is usually employed, "globalization" implies that not only has consumption been internationalized through cross-border trade in goods and services, but production also has been internationalized through foreign direct investment.1 In discussions relating to statistical indicators of globalization, it is commonly taken for granted that data on cross-border trade will be available, and so the attention is focused on information relating to the operations of direct investment enterprises, or affiliates… more »
As in many other developed countries, international relocations are currently a very hot topic in France. This can be readily concluded from the number of articles devoted by the French newspapers to this subject in 2004, compared to the preceding years (Table 1). A heated debate already took place in the early 1990s, culminating with the reports of Arthuis and Devedjian in 1993… more »
The global offshore corporate services (OCS) market includes a broad range of activities, from call and contact centers to business processes to software development. New, more knowledge-intensive services have started to be successfully offshored on a large scale in recent years, whether through outsourcing or through in-house operations. The increasing size, diversity and complexity of this market have generated opportunities for a growing number of developing countries, including in Latin America and the Caribbean… more »
Industries are oft en thought of in terms of the nations that have launched the greatest innovations. There is a perception of a U.S. automotive industry pitted against a Japanese industry, for example, or the U.S. pharmaceutical industry against the European industry. Globalization has, however, rapidly changed the underlying nature of these competitive relationships… more »
This paper examines the implications of global production sharing for economic integration in East Asia, with emphasis on the behavior of trade flows in the wake of the 2008 global economic crisis. While trade in parts and components and final assembly within production networks (?network trade?) has generally grown faster than total world trade in manufacturing, the degree of dependence of East Asia on this new form of international specialization is proportionately larger than elsewhere in the world... more »
Countries that have embraced openness have been more successful in sustaining growth and moving up the development ladder than those that have not. The available evidence highlights that trade openness will contribute to growth and employment, provided that it is complemented by appropriate policies... more »
The returns to schooling and the skill premium are key parameters in various fields and policy debates, including the literatures on globalization and inequality, international migration, and technological change. This paper explores the skill premium and its correlation with exports in Latin America, thus linking the skill premium to the emerging literature on the structure of trade and development... more »
In this paper we provide a new metric for the contributions of countries to global value chains. It is based on an input-output analysis of vertically integrated industries, taking into account trade in intermediate inputs within and across countries. The value of global manufacturing output is allocated to labour and capital employed in various regions in the world… more »
This special issue aims to contribute to our understanding of developing countries’ prospects for upgrading in global value chains (GVCs) in the context of recent shifts in global demand and production. Trade integration and economic growth in many developing countries has been fuelled by the insertion of local producers in GVCs feeding into high-income markets, in particular North America, Europe and Japan. However, since the mid-1980s – a trend that has been accelerated by the 2008/2009 global economic crisis… more »
This report brings together OECD data on the globalisation of value chains, including the rise of outsourcing/offshoring. It first examines how OECD countries are affected by the globalisation of production, on both the macroeconomic and sector-specific levels. The costs and benefits of globalisation are then discussed, with an emphasis on employment and productivity. Finally, this report analyses how globalisation impacts the competitiveness of OECD countries, highlighting the need for an effective innovation strategy. The report discusses not only the moving up the value chain that takes place in OECD countries but also in China, as R&D is increasingly going to emerging countries. more »
This paper examines the impact of two crises on the global apparel value chain: the World Trade organization phase-out of the quota system for textiles and apparel in 2005, which provided access for many poor and small export-oriented economies to the markets of industrialized countries, and the current economic recession that has lowered demand for apparel exports and led to massive unemployment across the industry’s supply chain… more »
This paper examines the effect of the financial crisis on off-farm employment of China’s rural labor force. Using a national representative data set collected from across China, the paper finds that there was a substantial impact. By April 2009 the reduction in off-farm employment as a result of the crises was 6.8 percent of the rural labor force. Monthly earnings also declined… more »
Revolutionary transformations of industry and trade occurred from 1985 to the late-1990s – the regionalisation of supply chains. Before 1985, successful industrialisation meant building a domestic supply chain. Today, industrialisers join supply chains and grow rapidly because offshored production brings elements that took Korea and Taiwan decades to develop domestically… more »
The recent large and rapid slowdown in economic activity has resulted in even larger and more rapid declines in international trade. As world trade is set to rebound, this paper addresses three questions: (i) Will trade volumes rebound in a symmetric fashion as world economic growth rebounds? (ii) Will the crisis result in a change in the structure of trade… more »
The nature of international trade is changing. For centuries, trade mostly entailed an exchange of goods. Now it increasingly involves bits of value being added in many different locations, or what might be called trade in tasks… more »
The geographical fragmentation of production has created a new trade reality. Often referred to as global value chains or vertical specialization, this fragmentation deepens the interdependency of trade relations and has many implications for how we understand trade policy. This book sheds light on the nature of this interdependency, and the contribution of trade to national economies. It illustrates the conjunction of technical, institutional and political changes that led to the emergence of production and trade networks in East Asia… more »
This paper extends the quantitative measures of vertical specialization proposed by Hummels, Ishii, and Yi (2001) into a framework that includes many countries based on an international input-output model. It not only distributes foreign value added in a country’s exports to its original sources, but also further decomposes domestic value added in a country’s exports into direct exports and indirect intermediate exports via third countries... more »
In this article, we apply global value chain (GVC) analysis to recent trends in the global automotive industry, with special attention paid to the case of North America. We use the three main elements of the GVC framework—firm-level chain governance, power and institutions—to highlight some of the defining characteristics of this important industry. First, national political institutions create pressure for local content, which drives production close to end markets… more »
Advances in transportation and communication technology, together with the low barriers to trade, have contributed in the recent decades to the emergence of a new structure of production and international trade. In several industries, production processes have broken up into several stages or ‘production tasks’ that are no longer closely tightened in time and space… more »
The aim of this paper is to analyze the changes in the wage share in manufacturing industry in Mexico, Turkey, and Korea in the era of globalization. The focus is on the one hand over the effects of globalization on the wage share , which are measured by the effects of international trade and FDI intensity of the economy. On the other hand, the process of opening up has been accompanied by major currency crises in most developing countries in the last decade, which has affected the wage share through exchange rate depreciation and economic recession... more »
A powerpoint presentation on The World Input-Output Database (WIOD) Project presented by Robert Stehrer from the Vienna Institute for International Economic Studies. The project is funded under the 7th Framework Programme. The project started in May 2009 with prospective end in April 2012... more »
The trade collapse that followed the recent financial crisis has led to a renewed interest on the measurement issues affecting international merchandise trade statistics in the new globalized economy. The international fragmentation of industrial production blurs the concept of country of origin and calls for the production of new statistics on the domestic content of exports... more »
