IDEAS home Printed from https://ideas.repec.org/a/onb/oenbfi/y2014i3b2.html
   My bibliography  Save this article

Assessing the Full Extent of Trade Integration between the EU and Russia – A Global Value Chain Perspective

Author

Listed:

Abstract

We analyze trade linkages between EU Member States and Russia, taking into account indirect trade links in global value chains. Our analysis is based on data for 2011 from the World Input-Output Database combined with gross trade flows between Russia and individual EU economies. We derive our conclusions from three indicators: gross exports in final use, value added in final use and value added in output. The latter two novel indicators are able to capture direct and indirect links jointly by allocating the full amount of value added from Russia in EU final domestic use and output, and inversely, the full amount of EU value added in Russia’s final domestic use and output. Russia represents the EU’s fourth-largest trade partner in terms of direct export shares, while the EU is Russia’s largest trade partner. In the same vein, Russia’s economy is considerably more dependent on European value added for both final use and output production than vice versa. However, the degree of integration varies greatly among EU Member States. For example, the Baltic states are notably more dependent on value added from Russia than vice versa, and certain economic sectors in the EU, such as the energy sector, utilities and air transport, are strongly dependent on inputs from Russia.

Suggested Citation

  • Konstantins Benkovskis & Jūlija Pastušenko & Julia Wörz, 2014. "Assessing the Full Extent of Trade Integration between the EU and Russia – A Global Value Chain Perspective," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue 3, pages 31-47.
    • Handle: RePEc:onb:oenbfi:y:2014:i:3:b:2
    as

    Download full text from publisher

    File URL: https://www.oenb.at/dam/jcr:b7861511-4539-4a6d-a20f-e52747b704f8/feei_2014_q3_studies_woerz.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Robert Koopman & Zhi Wang & Shang-Jin Wei, 2014. "Tracing Value-Added and Double Counting in Gross Exports," American Economic Review, American Economic Association, vol. 104(2), pages 459-494, February.
    2. Richard Baldwin & Javier Lopez-Gonzalez, 2015. "Supply-chain Trade: A Portrait of Global Patterns and Several Testable Hypotheses," The World Economy, Wiley Blackwell, vol. 38(11), pages 1682-1721, November.
    3. Martin Borowiecki & Bernhard Dachs & Doris Hanzl-Weiss & Steffen Kinkel & Johannes Pöschl & Magdolna Sass & Thomas Christian Schmall & Robert Stehrer & Andrea Szalavetz, 2012. "Global Value Chains and the EU Industry," wiiw Research Reports 383, The Vienna Institute for International Economic Studies, wiiw.
    4. Nagwa Riad & Luca Errico & Christian Henn & Christian Saborowski & Mika Saito & Jarkko Turunen, 2012. "Changing Patterns of Global Trade," IMF Departmental Papers / Policy Papers 2012/001, International Monetary Fund.
    5. Marcel Timmer & Abdul A. Erumban & Reitze Gouma & Bart Los & Umed Temurshoev & Gaaitzen J. de Vries & I–aki Arto & Valeria Andreoni AurŽlien Genty & Frederik Neuwahl & JosŽ M. Rueda?Cantuche & Joseph , 2012. "The World Input-Output Database (WIOD): Contents, Sources and Methods," IIDE Discussion Papers 20120401, Institue for International and Development Economics.
    6. Robert Koopman & William Powers & Zhi Wang & Shang-Jin Wei, 2010. "Give Credit Where Credit Is Due: Tracing Value Added in Global Production Chains," NBER Working Papers 16426, National Bureau of Economic Research, Inc.
    7. Johnson, Robert C. & Noguera, Guillermo, 2012. "Accounting for intermediates: Production sharing and trade in value added," Journal of International Economics, Elsevier, vol. 86(2), pages 224-236.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. João Amador & Sónia Cabral & Rossana Mastrandrea & Franco Ruzzenenti, 2018. "Who’s Who in Global Value Chains? A Weighted Network Approach," Open Economies Review, Springer, vol. 29(5), pages 1039-1059, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Benkovskis Konstantins & Wörz Julia, 2018. "“Made in China”: how does it affect our understanding of global market shares?," The B.E. Journal of Macroeconomics, De Gruyter, vol. 18(2), pages 1-26, June.
    2. Victor Kummritz, 2015. "Global Value Chains: Benefiting the Domestic Economy?," IHEID Working Papers 02-2015, Economics Section, The Graduate Institute of International Studies.
    3. Pierluigi Montalbano & Silvia Nenci & Carlo Pietrobelli, 2018. "Opening and linking up: firms, GVCs, and productivity in Latin America," Small Business Economics, Springer, vol. 50(4), pages 917-935, April.
    4. João Amador & Sónia Cabral, 2017. "Networks of Value-added Trade," The World Economy, Wiley Blackwell, vol. 40(7), pages 1291-1313, July.
    5. Silvia Fabiani & Alberto Felettigh & Alfonso Rosolia, 2023. "Foreign Value Added along the Consumption Distribution," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 9(1), pages 35-60, March.
    6. Richard Baldwin & Rebecca Freeman & Angelos Theodorakopoulos, 2022. "Horses for Courses: Measuring Foreign Supply Chain Exposure," NBER Working Papers 30525, National Bureau of Economic Research, Inc.
    7. Ferraz, Lucas Pedreira do Couto & Gutierre, Leopoldo & Cabral, Rodolfo Arruda, 2015. "The manufacturing industry in Brazil in the era of global value chains," Textos para discussão 402, FGV EESP - Escola de Economia de São Paulo, Fundação Getulio Vargas (Brazil).
    8. João Amador & Rita Cappariello & Robert Stehrer, 2015. "Global Value Chains: A View from the Euro Area," Asian Economic Journal, East Asian Economic Association, vol. 29(2), pages 99-120, June.
    9. João Amador & Sónia Cabral & Rossana Mastrandrea & Franco Ruzzenenti, 2018. "Who’s Who in Global Value Chains? A Weighted Network Approach," Open Economies Review, Springer, vol. 29(5), pages 1039-1059, November.
    10. Kuboniwa, Masaaki, 2014. "Russia’s Global Value Chain using a Modified World Input-Output Data," RRC Working Paper Series 50, Russian Research Center, Institute of Economic Research, Hitotsubashi University.
    11. Arjan Lejour & Hugo Rojas-Romagosa & Paul Veenendaal, 2017. "Identifying hubs and spokes in global supply chains using redirected trade in value added," Economic Systems Research, Taylor & Francis Journals, vol. 29(1), pages 66-81, January.
    12. Nenci, Silvia & Fusacchia, Ilaria & Giunta, Anna & Montalbano, Pierluigi & Pietrobelli, Carlo, 2022. "Mapping global value chain participation and positioning in agriculture and food: stylised facts, empirical evidence and critical issues," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 11(2), July.
    13. Ferraz, Lucas & Ribeiro, Marcel B. & Monastério, Pedro, 2015. "Connecting to Global Value Chains: The Dynamic General Equilibrium Effects of a PTA between China and Mercosur over the economy of Brazil," Conference papers 332666, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    14. Veenendaal, Paul, 2013. "Trade Redirection in Global Supply Chains," Conference papers 332324, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    15. Inga Heiland, 2017. "Five Essays on International Trade, Factor Flows and the Gains from Globalization," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 74.
    16. Zhi Wang & Shang-Jin Wei & Kunfu Zhu, 2013. "Quantifying International Production Sharing at the Bilateral and Sector Levels," NBER Working Papers 19677, National Bureau of Economic Research, Inc.
    17. Marta Solaz Alamá, 2016. "Cadenas globales de valor y generación de valor añadido: El caso de la economía española," Working Papers. Serie EC 2016-01, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    18. Vrh, Nataša, 2015. "Pay-off to Participation in Global Value Chains: How Much are New EU Member States Lagging behind the Rest of EU Countries in Terms of Domestic Value Added in Exports?," MPRA Paper 67805, University Library of Munich, Germany.
    19. Biyik, Onur, 2022. "Double Counting in Mystery: Journey of Intermediate Products in Multi-Country Trade," Conference papers 333417, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    20. Chung, Sung Hoon, 2016. "Korea's Participation in Global Value Chains: Measures and Implications," KDI Journal of Economic Policy, Korea Development Institute (KDI), vol. 38(4), pages 45-76.

    More about this item

    Keywords

    Trade integration; global value chains; Russia; European Union;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F15 - International Economics - - Trade - - - Economic Integration
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:onb:oenbfi:y:2014:i:3:b:2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Elisabeth Beckmann (email available below). General contact details of provider: https://edirc.repec.org/data/oenbbat.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.