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Quantifying the productivity e ects of global value chains

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  • Sara Formai
  • Filippo Vergara Caffarelli

Abstract

This work analyses the relationship between international fragmentation of production and productivity growth. To identify the impact of fragmentation on productivity growth,we employ the methodology proposed in a different context by Rajan and Zingales (1996). In particular we interact the length and the width of sectoral production chains with a measure of countries' involvement in international fragmentation of production. We find evidence indicating that off-shoring increases labour productivity and total factor productivity in the externalising country.

Suggested Citation

  • Sara Formai & Filippo Vergara Caffarelli, 2015. "Quantifying the productivity e ects of global value chains," Cambridge Working Papers in Economics 1564, Faculty of Economics, University of Cambridge.
    • Handle: RePEc:cam:camdae:1564
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