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Value added content of trade: A comprehensive approach

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  • Foster-McGregor, Neil
  • Stehrer, Robert

Abstract

This letter provides an approach to decompose the value added content of trade into foreign and domestic components when intermediates are traded. The measure adds to the existing literature by considering both exports and imports simultaneously. In this way this approach generalizes the commonly applied vertical specialization measures based on exports only which are encompassed.

Suggested Citation

  • Foster-McGregor, Neil & Stehrer, Robert, 2013. "Value added content of trade: A comprehensive approach," Economics Letters, Elsevier, vol. 120(2), pages 354-357.
    • Handle: RePEc:eee:ecolet:v:120:y:2013:i:2:p:354-357
    DOI: 10.1016/j.econlet.2013.05.003
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    References listed on IDEAS

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    1. Guillaume Daudin & Christine Rifflart & Danielle Schweisguth, 2011. "Who produces for whom in the world economy?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 44(4), pages 1403-1437, November.
    2. Trefler, Daniel & Zhu, Susan Chun, 2010. "The structure of factor content predictions," Journal of International Economics, Elsevier, vol. 82(2), pages 195-207, November.
    3. Robert Stehrer, 2013. "Accounting Relations in Bilateral Value Added Trade," wiiw Working Papers 101, The Vienna Institute for International Economic Studies, wiiw.
    4. Robert Stehrer, 2012. "Trade in Value Added and the Valued Added in Trade," wiiw Working Papers 81, The Vienna Institute for International Economic Studies, wiiw.
    5. Rudolfs Bems & Robert C. Johnson & Kei-Mu Yi, 2011. "Vertical Linkages and the Collapse of Global Trade," American Economic Review, American Economic Association, vol. 101(3), pages 308-312, May.
    6. Erik Dietzenbacher & Bart Los & Robert Stehrer & Marcel Timmer & Gaaitzen de Vries, 2013. "The Construction Of World Input-Output Tables In The Wiod Project," Economic Systems Research, Taylor & Francis Journals, vol. 25(1), pages 71-98, March.
    7. Hummels, David & Ishii, Jun & Yi, Kei-Mu, 2001. "The nature and growth of vertical specialization in world trade," Journal of International Economics, Elsevier, vol. 54(1), pages 75-96, June.
    8. Johnson, Robert C. & Noguera, Guillermo, 2012. "Accounting for intermediates: Production sharing and trade in value added," Journal of International Economics, Elsevier, vol. 86(2), pages 224-236.
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    More about this item

    Keywords

    Value added trade; Vertical specialization; Factor content of trade;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F19 - International Economics - - Trade - - - Other

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