IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/31864.html
   My bibliography  Save this paper

Trade Collapse, Trade Relapse and Global Production Networks: Supply Chains in the Great Recession (revised)

Author

Listed:
  • Escaith, Hubert

Abstract

Global supply chains reshaped international trade since the 1980s. Their role in explaining the trade collapse that followed the financial crisis of September 2008 was significant. Because manufacture production is internationally fragmented, adverse external shocks affect firms not only through final demand, but also through the disruption on the flow of inputs received from their suppliers. The future of supply chains depends of alternative exit scenarios from the Great Recession; as a result of global rebalancing, they will probably be smaller and more regional. Left unchecked, these centripetal forces may lead to a deterioration of global governance and to rampant deglobalization. On the other hand, because trade in goods for processing inflated artificially some bilateral trade imbalances, correcting them will prove easier in the short term, while the technical factors that made possible the internationalization of production will keep promoting further "flattening of the Earth" in the longer term. The reshaping of global effective demand is of particular importance for the labour abundant Least Developed Countries that were relying on global supply chains to attract productive investments.

Suggested Citation

  • Escaith, Hubert, 2009. "Trade Collapse, Trade Relapse and Global Production Networks: Supply Chains in the Great Recession (revised)," MPRA Paper 31864, University Library of Munich, Germany, revised Jun 2011.
    • Handle: RePEc:pra:mprapa:31864
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/31864/1/MPRA_paper_31864.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kristian Behrens & Gregory Corcos & Giordano Mion, 2013. "Trade Crisis? What Trade Crisis?," The Review of Economics and Statistics, MIT Press, vol. 95(2), pages 702-709, May.
    2. Agnès Bénassy-Quéré & Yvan Decreux & Lionel Fontagné & David Khoudour-Castéras, 2009. "Economic Crisis and Global Supply Chains," Working Papers 2009-15, CEPII research center.
    3. Escaith, Hubert, 2008. "Measuring trade in value added in the new industrial economy: statistical implications," MPRA Paper 14454, University Library of Munich, Germany.
    4. Bricongne, Jean-Charles & Fontagné, Lionel & Gaulier, Guillaume & Taglioni, Daria & Vicard, Vincent, 2012. "Firms and the global crisis: French exports in the turmoil," Journal of International Economics, Elsevier, vol. 87(1), pages 134-146.
    5. Sébastien Miroudot & Alexandros Ragoussis, 2009. "Vertical Trade, Trade Costs and FDI," OECD Trade Policy Papers 89, OECD Publishing.
    6. Anna Maria C. Menichini, 2011. "Inter‐Firm Trade Finance in Times of Crisis," The World Economy, Wiley Blackwell, vol. 34(10), pages 1788-1808, October.
    7. Escaith, Hubert, 2007. "Old and new dualisms in Latin America and Asia: labour productivity, international competitiveness and income distribution," MPRA Paper 14510, University Library of Munich, Germany, revised 2008.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Alyson C. Ma & Ari Van Assche, 2012. "Is East Asia's Economic Fate Chained to the West?," CIRANO Working Papers 2012s-11, CIRANO.
    2. Schmidt-Eisenlohr, Tim, 2013. "Towards a theory of trade finance," Journal of International Economics, Elsevier, vol. 91(1), pages 96-112.
    3. Escaith, Hubert, 2009. "Trade Collapse, Trade Relapse and Global Production Networks: Supply Chains in the Great Recession," MPRA Paper 18433, University Library of Munich, Germany.
    4. Kristian Behrens & Gregory Corcos & Giordano Mion, 2013. "Trade Crisis? What Trade Crisis?," The Review of Economics and Statistics, MIT Press, vol. 95(2), pages 702-709, May.
    5. Kemal Turkcan, 2016. "Evolving Patterns of Payment Methods in Turkish Foreign Trade," World Journal of Applied Economics, WERI-World Economic Research Institute, vol. 2(1), pages 3-29, June.
    6. Kemal Türkcan & Veysel Avsar, 2016. "Investigating the Role of Contract Enforcement and Financial Costs on the Payment Choice: Industry-Level Evidence from Turkey," Global Economy Journal (GEJ), World Scientific Publishing Co. Pte. Ltd., vol. 16(1), pages 135-160, March.
    7. Anderton, Robert & Tewolde, Tadios, 2011. "The global financial crisis: trying to understand the global trade downturn and recovery," Working Paper Series 1370, European Central Bank.
    8. Realita Eschachasthi, 2022. "Exporters in the Time of COVID-19 Pandemic: Evidence from Indonesia," Economics and Finance in Indonesia, Faculty of Economics and Business, University of Indonesia, vol. 68, pages 1-16, Juni.
    9. Andreas Hoefele & Tim Schmidt-Eisenlohr & Zhihong Yu, 2016. "Payment choice in international trade: Theory and evidence from cross-country firm-level data," Canadian Journal of Economics, Canadian Economics Association, vol. 49(1), pages 296-319, February.
    10. J.-S. Pentecôte & J.-C. Poutineau & F. Rondeau, 2015. "Trade Integration and Business Cycle Synchronization in the EMU: The Negative Effect of New Trade Flows," Open Economies Review, Springer, vol. 26(1), pages 61-79, February.
    11. William F. Lincoln & Andrew H. McCallum & Michael Siemer, 2017. "The Great Recession and a Missing Generation of Exporters," Finance and Economics Discussion Series 2017-108, Board of Governors of the Federal Reserve System (U.S.).
    12. Roberto Álvarez & Camila Sáez, 2015. "Post-Crisis Financiera y Expansión de las Exportaciones: Micro-Evidencia para Chile," Working Papers Central Bank of Chile 748, Central Bank of Chile.
    13. Dennis Novy & Alan M. Taylor, 2020. "Trade and Uncertainty," The Review of Economics and Statistics, MIT Press, vol. 102(4), pages 749-765, October.
    14. Crinò, Rosario & Ogliari, Laura, 2015. "Financial Frictions, Product Quality, and International Trade," CEPR Discussion Papers 10555, C.E.P.R. Discussion Papers.
    15. Taglioni, Daria & Zavacka, Veronika, 2012. "Innocent bystanders : how foreign uncertainty shocks harm exporters," Policy Research Working Paper Series 6226, The World Bank.
    16. Chor, Davin & Manova, Kalina, 2012. "Off the cliff and back? Credit conditions and international trade during the global financial crisis," Journal of International Economics, Elsevier, vol. 87(1), pages 117-133.
    17. Muûls, Mirabelle, 2015. "Exporters, importers and credit constraints," Journal of International Economics, Elsevier, vol. 95(2), pages 333-343.
    18. Peter S. Eppinger & Nicole Meythaler & Marc-Manuel Sindlinger & Marcel Smolka, 2018. "The great trade collapse and the Spanish export miracle: Firm-level evidence from the crisis," The World Economy, Wiley Blackwell, vol. 41(2), pages 457-493, February.
    19. Pol Antràs, 2020. "De-Globalisation? Global Value Chains in the Post-COVID-19 Age," NBER Working Papers 28115, National Bureau of Economic Research, Inc.
    20. van Bergeijk, P.A.G. & Dao, T.K., 2018. "Global trade finance, trade collapse and trade slowdown: a Granger causality analysis," ISS Working Papers - General Series 634, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.

    More about this item

    Keywords

    international supply chain; global value chains; great trade collapse; exit scenario; trade and development;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • F1 - International Economics - - Trade
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:31864. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.