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Mapping CO2 emissions in Global Value Chains: Does a value-added smile curve imply an emissions frown curve?

Author

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  • Schwarzbauer, Wolfgang
  • Bittó, Virág
  • Koch, Philipp
  • Steininger, Jonathan

Abstract

Global value chains (GVCs) play a crucial role in international trade. High value-added activities tend to cluster at the start and the end of GVCs, resulting in a U-shaped relationship across production steps known as the “smile curve”. The distribution of CO2 emissions along the value chain, however, is relatively unexplored. Here, we map embodied CO2 emissions to test whether emissions are distributed differently across production stages than value–added. We find that activities with high emission intensities cluster at early stages, while late stages exhibit lower emission intensities. This results in a downward-sloping CO2 emissions curve with tentative evidence of a frown-curve pattern. Also, we find that the prevalence of a U-shaped pattern in the distribution of value-added across production stages declined significantly since 1995. We explore several examples and provide an interactive tool to explore the mapping of value-added and emissions across more than 1,000 GVCs of industrial goods.

Suggested Citation

  • Schwarzbauer, Wolfgang & Bittó, Virág & Koch, Philipp & Steininger, Jonathan, 2025. "Mapping CO2 emissions in Global Value Chains: Does a value-added smile curve imply an emissions frown curve?," Structural Change and Economic Dynamics, Elsevier, vol. 75(C), pages 332-348.
    • Handle: RePEc:eee:streco:v:75:y:2025:i:c:p:332-348
    DOI: 10.1016/j.strueco.2025.08.009
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    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • F18 - International Economics - - Trade - - - Trade and Environment
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development
    • F64 - International Economics - - Economic Impacts of Globalization - - - Environment
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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