IDEAS home Printed from https://ideas.repec.org/a/taf/pocoec/v29y2017i3p405-430.html
   My bibliography  Save this article

The convergence in domestic value-added of exports in the EU

Author

Listed:
  • Nataša Vrh

Abstract

Difficulties in measuring domestic value-added in exports (DVA) have led to the development of alternative measures of trade in value-added terms. These new measures have enabled more accurate estimates that reveal that the EU countries from Central and Eastern Europe (CEE10) exhibit an approximately five percentage points lower DVA share of exports compared with other EU countries (EU15). The lag is on average the highest in knowledge-intensive manufacturing sectors (eight percentage points) and the lowest in knowledge-intensive services (0.3 percentage points). However, this article argues that the CEE10 economies have acquired new knowledge by participating in GVCs and thus have gradually started increasing their level of DVA. Based on EU trade data, this article presents evidence of convergence of DVA in manufacturing and especially in the services sector. It is also shown that a negative relationship exists between participation in GVCs and DVA in the CEE10 economies that is declining over time in both manufacturing and services exports.

Suggested Citation

  • Nataša Vrh, 2017. "The convergence in domestic value-added of exports in the EU," Post-Communist Economies, Taylor & Francis Journals, vol. 29(3), pages 405-430, July.
    • Handle: RePEc:taf:pocoec:v:29:y:2017:i:3:p:405-430
    DOI: 10.1080/14631377.2017.1319107
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/14631377.2017.1319107
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/14631377.2017.1319107?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Agnese, Pablo & Joan Enric, Ricart, 2009. "Offshoring: Facts and numbers at the country level," MPRA Paper 16503, University Library of Munich, Germany.
    2. Baldwin, Richard & Robert-Nicoud, Frédéric, 2007. "Offshoring: General Equilibrium Effects on Wages, Production and Trade," CEPR Discussion Papers 6218, C.E.P.R. Discussion Papers.
    3. Nathalie AMINIAN & K. C. FUNG & IIZAKA Hitomi, 2007. "Foreign Direct Investment, Intra-Regional Trade and Production Sharing in East Asia," Discussion papers 07064, Research Institute of Economy, Trade and Industry (RIETI).
    4. William Powers, 2012. "The Value of Value Added," World Economics, World Economics, 1 Ivory Square, Plantation Wharf, London, United Kingdom, SW11 3UE, vol. 13(4), pages 19-38, October.
    5. Marin, Dalia, 2004. "‘A Nation of Poets and Thinkers’ - Less So with Eastern Enlargement? Austria and Germany," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 77, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
    6. Yuqing Xing & Neal Detert, 2011. "How the iPhone Widens the United States Trade Deficit with the People's Republic of China:," Aussenwirtschaft, University of St. Gallen, School of Economics and Political Science, Swiss Institute for International Economics and Applied Economics Research, vol. 66(03), pages 339-350, September.
    7. Yuqing Xing & Neal Detert, 2010. "How the iPhone Widens the United States Trade Deficit with the People’s Republic of China," Trade Working Papers 23128, East Asian Bureau of Economic Research.
    8. João Amador & Sónia Cabral, 2014. "Global Value Chains: Surveying Drivers, Measures and Impacts," Working Papers w201403, Banco de Portugal, Economics and Research Department.
    9. Alessandro Nicita & Victor Ognivtsev & Miho Shirotori, 2013. "Global Supply Chains: Trade And Economic Policies For Developing Countries," UNCTAD Blue Series Papers 55, United Nations Conference on Trade and Development.
    10. De Backer, Koen & Miroudot, Sébastien, 2014. "Mapping global value chains," Libros de la CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 37176.
    11. Carlo Altomonte & Filippo Di Mauro & Gianmarco I. P. Ottaviano & Armando Rungi & Vincent Vicard, 2012. "Global Value Chains During the Great Trade Collapse: A Bullwhip Effect?," CEP Discussion Papers dp1131, Centre for Economic Performance, LSE.
    12. Robert Z. Lawrence, 1994. "Trade, Multinationals, & Labor," NBER Working Papers 4836, National Bureau of Economic Research, Inc.
    13. Amador, João & Cabral, Sónia, 2014. "Global value chains: surveying drivers and measures," Working Paper Series 1739, European Central Bank.
    14. Jesmin Rahman & Mr. Tianli Zhao, 2013. "Export Performance in Europe: What Do We Know from Supply Links?," IMF Working Papers 2013/062, International Monetary Fund.
    15. Gereffi, Gary & Fernandez-Stark, Karina, 2010. "The offshore services value chain : developing countries and the crisis," Policy Research Working Paper Series 5262, The World Bank.
    16. Gereffi, Gary & Luo, Xubei, 2014. "Risks and opportunities of participation in global value chains," Policy Research Working Paper Series 6847, The World Bank.
    17. 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.
    18. Daria Taglioni & Deborah Winkler, 2016. "Making Global Value Chains Work for Development," World Bank Publications - Books, The World Bank Group, number 24426, December.
    19. Ernst, Dieter, 1997. "From Partial to Systemic Globalization: International Production Networks in the Electronics Industry," UCAIS Berkeley Roundtable on the International Economy, Working Paper Series qt7326w69k, UCAIS Berkeley Roundtable on the International Economy, UC Berkeley.
    20. Marin, Dalia, 2004. "'A Nation of Poets and Thinkers' - Less So with Eastern Enlargement? Austria and Germany," Discussion Papers in Economics 329, University of Munich, Department of Economics.
    21. Baldwin, Richard, 2012. "Global supply chains: Why they emerged, why they matter, and where they are going," CEPR Discussion Papers 9103, C.E.P.R. Discussion Papers.
    22. Robert Stehrer & Roman Stöllinger, 2013. "Positioning Austria in the Global Economy: Value Added Trade, International Production Sharing and Global Linkages," FIW Research Reports series V-002, FIW.
    23. Richard Baldwin, 2011. "Trade And Industrialisation After Globalisation's 2nd Unbundling: How Building And Joining A Supply Chain Are Different And Why It Matters," NBER Working Papers 17716, National Bureau of Economic Research, Inc.
    24. Yuqing Xing & Neal Detert, 2010. "How the iPhone Widens the United States Trade Deficit with the People’s Republic of China," Trade Working Papers 23280, East Asian Bureau of Economic Research.
    25. Koen De Backer & Norihiko Yamano, 2012. "International Comparative Evidence on Global Value Chains," OECD Science, Technology and Industry Working Papers 2012/3, OECD Publishing.
    26. Jyrki Ali-Yrkkö & Neil Foster-McGregor & Doris Hanzl-Weiss & Petri Rouvinen & Timo Seppälä & Robert Stehrer & Roman Stöllinger & Pekka Ylä-Anttila, 2011. "Trade in Intermediate Products and EU Manufacturing Supply Chains," wiiw Research Reports 369, The Vienna Institute for International Economic Studies, wiiw.
    27. 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.
    Full references (including those not matched with items on IDEAS)

    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. 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.
    2. Maria Savona, 2021. "Revisiting High Development Theory to Explain Upgrading Prospects in Business Services Global Value Chains," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 33(2), pages 206-226, April.
    3. C. Duprez & L. Dresse, 2013. "The Belgian economy in global value chains. An exploratory analysis," Economic Review, National Bank of Belgium, issue ii, pages 07-21, September.
    4. Dutta, Sourish, 2018. "Framework of Learning and Upgrading in Global Value Chains," EconStor Preprints 237381, ZBW - Leibniz Information Centre for Economics.
    5. Dutta, Sourish, 2020. "Learning and Upgrading in Global Value Chains: An Analysis of India’s Manufacturing Sector," OSF Preprints 2ser9, Center for Open Science.
    6. Jona-Lasinio, Cecilia & Manzocchi, Stefano & Meliciani, Valentina, 2019. "Knowledge based capital and value creation in global supply chains," Technological Forecasting and Social Change, Elsevier, vol. 148(C).
    7. Emanuela Todeva & Ruslan Rakhmatullin, 2016. "Industry Global Value Chains, Connectivity and Regional Smart Specialisation in Europe. An Overview of Theoretical Approaches and Mapping Methodologies," JRC Research Reports JRC102801, Joint Research Centre.
    8. Evert Meijers & Martijn Burger & Masahisa Fujita & Nobuaki Hamaguchi, 2016. "Supply chain internationalization in East Asia: Inclusiveness and risks," Papers in Regional Science, Wiley Blackwell, vol. 95(1), pages 81-100, March.
    9. 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.
    10. Cecilia Jona Lasinio & Stefano Manzocchi & Valentina Meliciani, 2017. "Knowledge Based Capital and Value Creation in Global Supply Chains," Working Papers LuissLab 17134, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    11. 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.
    12. Laura Dell'Agostino, 2017. "Italy’S Participation In International Supply And Production Networks Using Value Added Trade Data," Departmental Working Papers of Economics - University 'Roma Tre' 0228, Department of Economics - University Roma Tre.
    13. Jovanović, Miroslav N., 2019. "The Supply Chain Economy: How Far does it Spread in Space and Time?," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 72(4), pages 393-452.
    14. Gideon Ndubuisi & Solomon Owusu, 2021. "How important is GVC participation to export upgrading?," The World Economy, Wiley Blackwell, vol. 44(10), pages 2887-2908, October.
    15. Dutta, Sourish, 2017. "Research Methods of Assessing Global Value Chains," MPRA Paper 106201, University Library of Munich, Germany.
    16. Dutta, Sourish, 2017. "Mechanics of Global Value chains: India’s Perspective," EconStor Preprints 235156, ZBW - Leibniz Information Centre for Economics.
    17. 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.
    18. Aichele, Rahel & Heiland, Inga, 2018. "Where is the value added? Trade liberalization and production networks," Journal of International Economics, Elsevier, vol. 115(C), pages 130-144.
    19. Amat Adarov & Robert Stehrer, 2021. "Implications of foreign direct investment, capital formation and its structure for global value chains," The World Economy, Wiley Blackwell, vol. 44(11), pages 3246-3299, November.
    20. Jean Baliè & Davide Del Prete & Emiliano Magrini & Pierluigi Montalbano & Silvia Nenci, 2017. "Agriculture and Food Global Value Chains in Sub-Saharan Africa: Does bilateral trade policy impact on backward and forward participation?," Working Papers 03/2017, IMT School for Advanced Studies Lucca, revised Feb 2017.

    More about this item

    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:taf:pocoec:v:29:y:2017:i:3:p:405-430. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CPCE20 .

    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.