Global Value Chains and Trade Elasticities
AbstractPrevious studies have argued that global value chains (GVCs) have increased the sensitivity of trade to external business cycle shocks. This may occur either because GVC trade is concentrated in durable goods industries, which are known to have high income elasticities (a composition effect), or because, within industries, GVC trade has a higher income elasticity than regular trade (a supply chain effect). Using Chinese trade data across customs regimes and industries during the period 1995-2009, we find evidence for the former, but not the latter.
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Bibliographic InfoPaper provided by University of Hawaii Economic Research Organization, University of Hawaii at Manoa in its series Working Papers with number 2014-2.
Length: 10 pages
Date of creation: Feb 2014
Date of revision:
global value chains; trade elasticities; supply chain effect; composition effect;
Other versions of this item:
- F1 - International Economics - - Trade
- F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-02-15 (All new papers)
- NEP-INT-2014-02-15 (International Trade)
- NEP-OPM-2014-02-15 (Open Economy Macroeconomics)
- NEP-SOG-2014-02-15 (Sociology of Economics)
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