Estimating domestic content in exports when processing trade is pervasive
AbstractFor many questions, it is crucial to know the extent of domestic value added (DVA) in a country's exports, but the computation is more complicated when processing trade is pervasive. We propose a method for computing domestic and foreign contents that allows for processing trade. By applying our framework to Chinese data, we estimate that the share of domestic content in its manufactured exports was about 50% before China's WTO membership, and has risen to nearly 60% since then. There are also interesting variations across sectors. Those sectors that are likely labeled as relatively sophisticated such as electronic devices have particularly low domestic content (about 30% or less).
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Development Economics.
Volume (Year): 99 (2012)
Issue (Month): 1 ()
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Domestic content; Foreign content; Processing exports; Duty drawback; Vertical specialization; Global production chains; Chinese economy;
Find related papers by JEL classification:
- F1 - International Economics - - Trade
- C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
- C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Chinas prospects for export-driven growth
by Brendan Coates in East Asia Forum on 2013-03-08 23:00:55
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