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Macroeconomic effects of EU value chain participation

Author

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  • Antonia Lopez Villavicencio

    (EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)

  • Mariam Camarero
  • Cecilio Tamarit

Abstract

In this paper we analyze some macroeconomic effects derived from the participation of EU countries in global and regional value chains over the period 1990-2019. By employing local projections, we show that the impact of value chain participation on economic performance depends crucially on the country's position in the production chain. While backward participation is linked to better economic performance, forward participation leads to declining domestic output and a rise in unemployment. Moreover, we find evidence of important heterogeneity among EU countries, with peripheral and CEE countries being more sensitive to shocks in the participation indicators. Our results are robust to different controls.

Suggested Citation

  • Antonia Lopez Villavicencio & Mariam Camarero & Cecilio Tamarit, 2021. "Macroeconomic effects of EU value chain participation," Working Papers hal-04159742, HAL.
    • Handle: RePEc:hal:wpaper:hal-04159742
    Note: View the original document on HAL open archive server: https://hal.science/hal-04159742
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    Cited by:

    1. Carpa, Nur & Martínez-Zarzoso, Inmaculada, 2022. "The impact of global value chain participation on income inequality," International Economics, Elsevier, vol. 169(C), pages 269-290.

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    More about this item

    Keywords

    Global Value Chains; EU; local projections; VAR;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

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