International Fragmentation of Production, Trade and Growth: Impacts and Prospects for EU Member States
AbstractThere has been an ongoing trend towards increasing internationalisation of production over the past two decades or so. This implies that countries become more dependent on demand from foreign countries but also that countries and industries are able to source intermediates from different countries, an activity referred to as ‘offshoring’. Whereas the former aspect means an increasing dependency on foreign markets, the second aspect implies that countries and industries source at lower costs making them more productive and competitive. Using the World Input-Output Database (WIOD) we first provide an overview of these trends over the period 1995-2011 for 40 advanced and emerging countries with a specific focus on the EU as a whole and the individual EU member states. In the second part of the paper we show results from an econometric analysis to explain growth performance, focusing on the impacts of the increasing internationalisation of production.
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Bibliographic InfoPaper provided by The Vienna Institute for International Economic Studies, wiiw in its series wiiw Research Reports with number 387.
Length: 50 pages including 27 Tables and 14 Figures
Date of creation: May 2013
Date of revision:
Publication status: Published as wiiw Research Report
Other versions of this item:
- Neil Foster & Robert Stehrer & Marcel Timmer, 2013. "International fragmentation of production, trade and growth: Impacts and prospects for EU member states," European Economy - Economic Papers 484, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
- E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
- F15 - International Economics - - Trade - - - Economic Integration
- F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
- F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-08-23 (All new papers)
- NEP-EUR-2013-08-23 (Microeconomic European Issues)
- NEP-INT-2013-08-23 (International Trade)
- NEP-MAC-2013-08-23 (Macroeconomics)
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