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How Global Are Local Value Chains?

Author

Listed:
  • Alessandro Borin
  • Francesco Paolo Conteduca
  • Fabrizio Leone
  • Michele Mancini
  • Patrick Zoi

Abstract

This paper examines how international trade shocks transmit through domestic supply chains, shaping local economic vulnerabilities. Using detailed firm-to-firm domestic and foreign transaction data, we quantify the direct and indirect exposure of Italian labor markets to two major sources of external risk: imports from China and exports to the United States. We quantify the importance of firms’ domestic and foreign linkages for overall exposure and highlight the critical role of wholesalers and top trading firms within the domestic network in shaping tails risks. Pronounced local disparities in exposure reveal that aggregate trade statistics conceal substantial and uneven regional vulnerabilities.

Suggested Citation

  • Alessandro Borin & Francesco Paolo Conteduca & Fabrizio Leone & Michele Mancini & Patrick Zoi, 2025. "How Global Are Local Value Chains?," CESifo Working Paper Series 12271, CESifo.
    • Handle: RePEc:ces:ceswps:_12271
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    More about this item

    Keywords

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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • F61 - International Economics - - Economic Impacts of Globalization - - - Microeconomic Impacts
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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