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Global Value Chains and Employment Growth in Asia

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  • Neil Foster-McGregor

    (Deputy Director, UNU-MERIT, Maastricht, Netherlands.)

Abstract

This paper considers the sources of employment demand in Asian economies. Using data from the World–Input Output Database, I examine the relative importance of domestic and foreign demand in generating employment. Despite some degree of heterogeneity across the sample, domestic demand is found to be the major driver of employment in all cases. Further, the relative importance of final and intermediate exports in generating employment varies by economy, with some economies relying on intermediate exports to generate employment to a greater extent than others, reflecting their importance as suppliers of intermediate inputs in global value chains, while others rely to a greater extent on final exports, reflecting their role as assemblers within global value chains. Considering developments over time, I find that employment is driven by two offsetting factors: (i) final demand (either domestic or foreign) and (ii) labor productivity, with changes in interindustry structure also being important in the case of intermediate exports.

Suggested Citation

  • Neil Foster-McGregor, 2019. "Global Value Chains and Employment Growth in Asia," Asian Development Review, MIT Press, vol. 36(2), pages 100-130, September.
    • Handle: RePEc:tpr:adbadr:v:36:y:2019:i:2:p:100-130
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    File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/adev_a_00133
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    Cited by:

    1. Sri Juli Asdiyanti Samuda, 2023. "How Global Value Chains Affect Economic Output And Unemployment: An Empirical Evidence From Asean Countries," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 26(3), pages 513-538, September.
    2. Ping Hua, 2022. "Impacts of global value chains' participation and domestic consumption on manufacturing employment in China," Working Papers hal-03840490, HAL.

    More about this item

    Keywords

    crisis; decomposition; employment; global value chains;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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