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Complex Network Analysis for Characterizing Global Value Chains in Equipment Manufacturing

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  • Hao Xiao
  • Tianyang Sun
  • Bo Meng
  • Lihong Cheng

Abstract

The rise of global value chains (GVCs) characterized by the so-called “outsourcing”, “fragmentation production”, and “trade in tasks” has been considered one of the most important phenomena for the 21st century trade. GVCs also can play a decisive role in trade policy making. However, due to the increasing complexity and sophistication of international production networks, especially in the equipment manufacturing industry, conventional trade statistics and the corresponding trade indicators may give us a distorted picture of trade. This paper applies various network analysis tools to the new GVC accounting system proposed by Koopman et al. (2014) and Wang et al. (2013) in which gross exports can be decomposed into value-added terms through various routes along GVCs. This helps to divide the equipment manufacturing-related GVCs into some sub-networks with clear visualization. The empirical results of this paper significantly improve our understanding of the topology of equipment manufacturing-related GVCs as well as the interdependency of countries in these GVCs that is generally invisible from the traditional trade statistics.

Suggested Citation

  • Hao Xiao & Tianyang Sun & Bo Meng & Lihong Cheng, 2017. "Complex Network Analysis for Characterizing Global Value Chains in Equipment Manufacturing," PLOS ONE, Public Library of Science, vol. 12(1), pages 1-22, January.
    • Handle: RePEc:plo:pone00:0169549
    DOI: 10.1371/journal.pone.0169549
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    2. Di Filippo, Gabriele, 2018. "What Place does Luxembourg hold in Global Value Chains?," MPRA Paper 86235, University Library of Munich, Germany.
    3. Temel, Tugrul & Phumpiu, Paul, 2023. "Policy Design from a Network Perspective: Targeting a Sector, Cascade of Links, Network Resilience," MPRA Paper 118466, University Library of Munich, Germany.
    4. Charlie Joyez, 2019. "Alignment of Multinational Firms along Global Value Chains: A Network-based Perspective," GREDEG Working Papers 2019-05, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    5. Georgios Angelidis & Nikos C. Varsakelis, 2023. "Economic Shock Transmission through Global Value Chains: An Assessment using Network Analysis," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 29(3), pages 111-128, August.
    6. Temel, Tugrul & Phumpiu, Paul, 2023. "Policy Design from a Network Perspective: Targeting a Sector, Cascade of Links, Network Resilience," MPRA Paper 118389, University Library of Munich, Germany.
    7. Ding Nan & Pomi Shahbaz & Shamsheer ul Haq & Muhammad Nadeem & Muhammad Imran, 2023. "The Economies’ Ability to Produce Diversified and Complex Goods to Meet the Global Competition: Role of Gross Value Chain, Institutional Quality, and Human Capital," Sustainability, MDPI, vol. 15(8), pages 1-17, April.
    8. Xing, Lizhi & Guan, Jun & Wu, Shan, 2018. "Measuring the impact of final demand on global production system based on Markov process," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 502(C), pages 148-163.
    9. Wu, Gang & Pu, Yue & Shu, Tianran, 2021. "Features and evolution of global energy trade network based on domestic value-added decomposition of export," Energy, Elsevier, vol. 228(C).
    10. Jiang, Xuemei & Zhang, Shaoxue, 2021. "Visualizing the services embodied in global manufacturing exports," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 571(C).
    11. Zhang, Hongwei & Wang, Xinyi & Tang, Jing & Guo, Yaoqi, 2022. "The impact of international rare earth trade competition on global value chain upgrading from the industrial chain perspective," Ecological Economics, Elsevier, vol. 198(C).
    12. Barauskaite, Kristina & Nguyen, Anh D.M., 2021. "Global intersectoral production network and aggregate fluctuations," Economic Modelling, Elsevier, vol. 102(C).

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