Global value chains

I’m very excited, as perhaps only an economist could be, by a new (and free) VoxEU e-book, The Age of Global Value Chains: Maps and Policy Issues. As the first sentence in the foreword states: “The study of global value chains is the only way to fully understand the nature of today‚Äôs geographically dispersed production and trade.” This understanding is being extended by new sources and uses of data, the World Input-Output Database in particular – the e-book has an appendix describing this.

GCVs front cover

The book divides into a descriptive first part (including a look at network structures) and a second part looking at the impacts of the increased specialisation in production across national borders. These impacts in turn are divided between the macro level (including productivity, wages and jobs) and the effects at the level of firm organisation. If I have one complaint (without having read the book yet) it is that there is no essay looking at global value chains from the perspective of urban economics, and the sub-national clustering of specialised supply chains.

Still, it’s a mild complaint about a book to say there should be more of it. I’ll be reading this one eagerly, all the more so as there are troubling signs that world trade growth is slowing. And, as I argued in my post on the FT’s The Exchange, that could be related to the global productivity puzzle.

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4 thoughts on “Global value chains

  1. Pingback: Global value chains | Homines Economici

  2. Given that a great many of our problems arise from perceptions, date and structures that are of the past, but not the present nor the future, this kind of thinking is very welcome.

  3. Here’s an interesting post by Timothy Taylor. He argues (using an OECD paper) that ‘frontier firms’ have high productivity growth, but this is failing to diffuse to laggards who drag the average down:

    http://conversableeconomist.blogspot.co.uk/2015/07/productivity-growth-and-diffusion.html

    Global connections are cited as a key factor for diffusion.

    Britain is relatively open to the most innovative firms, so I’m not sure this is decisive in explaining our poor productivity performance.

    Very good blog on the FT by the way. I am a little skeptical of viewing an economy as being a GDP factory – seems to leave too much out in the aggregation.

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