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Who produces for whom in the world economy?

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Abstract

For nearly two decades, the share of trade in inputs, also called vertical trade, has dramatically increased. This paper suggests a new measure of international trade: “value-added trade”. Like many existing estimates, “value-added trade” is net of double-counted vertical trade. It also reallocate trade flows to their original input-producing industries and countries and allows to answer the question “who produces for whom”. In 2004, 27% of international trade were "only" vertical specialization trade. The sector repartition of value-added trade is very different from the sector repartition of standard trade. Value-added trade is less regionalized than standard trade.

Suggested Citation

  • Guillaume Daudin & Christine Rifflart & Danielle Schweisguth, 2009. "Who produces for whom in the world economy?," Documents de Travail de l'OFCE 2009-18, Observatoire Francais des Conjonctures Economiques (OFCE).
    • Handle: RePEc:fce:doctra:0918
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    File URL: http://www.ofce.sciences-po.fr/pdf/dtravail/WP2009-18.pdf
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    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F19 - International Economics - - Trade - - - Other

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