Mapping Vertical Trade
AbstractThe paper develops a method to map global networks of production sharing and processing trade. Relying on highly detailed bilateral trade data across a matrix of 75 countries, a network index gauges countries’ interdependence according to the extent of trade in parts and components for further processing and assembly of final export goods. The set of bilateral network relations is then subjected to an algorithm that lays it out for visualization as a world map of vertical trade networks. Maps are drawn in relation to processing trade across all industries, as well as for the electric/electronics and automotive industries, where such trade is most prominent. The analysis identifies three major hubs in the global networks: the People’s Republic of China in connection with Japan, Germany, and the United States. Apart from Mexico (mainly because of its maquiladoras network ties to the United States) the analysis highlights that outside Asia, developing countries are not yet involved in global production networks to any significant degree.
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Bibliographic InfoPaper provided by Asian Development Bank in its series ADB Economics Working Paper Series with number 263.
Length: 46 pages
Date of creation: Jun 2011
Date of revision:
Processing Trade; Network Analysis; Production Sharing; Factory Asia;
Find related papers by JEL classification:
- C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data
- F15 - International Economics - - Trade - - - Economic Integration
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
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- Ferrarini, Benno & Scaramozzino, Pasquale, 2013.
"Complexity, Specialization, and Growth,"
ADB Economics Working Paper Series
344, Asian Development Bank.
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