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Who produces for whom in the world economy?

  • Guillaume Daudin
  • Christine Rifflart
  • Danielle Schweisguth

For two decades, the share of trade in inputs, also called vertical trade, has been dramatically increasing. In reallocating trade flows to their original input-producing industries and countries, this paper suggests a new measure of international trade: `value-added trade' and makes it possible to answer the question `who produces for whom?' In 2004, 27% of international trade was vertical trade. The industrial and geographic patterns of value-added trade are very different from those of standard trade. Value-added trade is relatively less important in regional trade but the difference is not more important for Asia than for America.

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Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 44 (2011)
Issue (Month): 4 (November)
Pages: 1403-1437

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Handle: RePEc:cje:issued:v:44:y:2011:i:4:p:1403-1437
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