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Employment and Value Added Induced by Final Demands

Author

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  • Choi , Nakgyoon

    (Korea Institute for International Economic Policy)

Abstract

Recently, production processes from material procurement to marketing have been split into many stages and the value added from the production was divided among various countries. In other words, the global value chain has deepened, thereby changing "trade in goods" to "trade in tasks." Therefore, we need to approach international trade in terms of the value added rather than gross value. Previous literature proposed various methodologies to measure the trade in value added. They calculated the share of imported intermediate parts to produce the exporting goods using the input–output tables in specific years, but did not analyze the time–series trend of trade in value added. In addition, they did not provide the relative contribution of trade to the value added compared to other final demands such as investments and consumptions. This study analyzes the effects of final demands such as exports, investments, and consumptions on employment and value added. Specifically, it uses World Input–Output Tables based on prices in the previous year and Socio-Economic Accounts of 14 countries and 20 sectors from 1996 to 2009.

Suggested Citation

  • Choi , Nakgyoon, 2013. "Employment and Value Added Induced by Final Demands," World Economy Brief 13-5, Korea Institute for International Economic Policy.
    • Handle: RePEc:ris:kiepwe:2013_005
    DOI: 10.2139/ssrn.2320897
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