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Does the import diversity of inputs mitigate the negative impact of COVID-19 on global value chains?

Author

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  • Ando, Mitsuyo
  • Hayakawa, Kazunobu

Abstract

This study sheds light on the role of the import diversity of inputs and empirically explores the effects of COVID-19 on global value chains (GVCs). Specifically, we explicitly investigate the supply-side impacts of COVID-19 on GVCs during the period from January to August 2020 and examine how the import diversity of inputs influences such effects, using monthly export data of final machinery products for 35 countries and their indicator of diversity with 252 trade partner countries. As a result, we found that the negative supply-side effects are greatest in the transport equipment industry among three machinery industries. In addition, such negative impacts on machinery industries are larger during the trade fall period from February to May. Furthermore, we demonstrated that the import diversity of inputs played a significant role in partially mitigating the harmful supply-side effects of COVID-19, particularly during the initial period, i.e., February to March.

Suggested Citation

  • Ando, Mitsuyo & Hayakawa, Kazunobu, 2021. "Does the import diversity of inputs mitigate the negative impact of COVID-19 on global value chains?," IDE Discussion Papers 809, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper809
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    Cited by:

    1. Yoshihiko Hogen & Yojiro Ito & Kenji Kanai & Naoya Kishi, 2024. "Changes in the Global Economic Landscape and Issues for Japan's Economy," Bank of Japan Working Paper Series 24-E-3, Bank of Japan.
    2. Yasuyuki Todo & Keita Oikawa & Masahito Ambashi & Fukunari Kimura & Shujiro Urata, 2023. "Robustness and resilience of supply chains during the COVID‐19 pandemic," The World Economy, Wiley Blackwell, vol. 46(6), pages 1843-1872, June.
    3. TODO Yasuyuki, 2022. "Resilient and Innovative Supply Chains: Evidence-based policy and managerial implications," Policy Discussion Papers 22024, Research Institute of Economy, Trade and Industry (RIETI).
    4. Fukunari Kimura (ed.), 2023. "Viet Nam 2045: Development Issues and Challenges," Books, Economic Research Institute for ASEAN and East Asia (ERIA), number 978-602-5460-53-1, July.
    5. Sally Chen & Eric Tsang & Leanne Si Ying Zhang, 2023. "Global supply chain interdependence and shock amplification - evidence from Covid lockdowns," BIS Quarterly Review, Bank for International Settlements, March.
    6. Sangeeta Khorana & Inmaculada Martínez‐Zarzoso & Salamat Ali, 2023. "An anatomy of the impact of COVID‐19 on the global and intra‐Commonwealth trade in goods," Review of International Economics, Wiley Blackwell, vol. 31(2), pages 550-579, May.
    7. Ying Chen & Yabin Zhang, 2023. "Services Development, Technological Innovation, and the Embedded Location of the Agricultural Global Value Chain," Sustainability, MDPI, vol. 15(3), pages 1-14, February.
    8. Qianxue Zhang, 2022. "The Hubei lockdown and its global impacts via supply chains," Review of International Economics, Wiley Blackwell, vol. 30(4), pages 1087-1109, September.
    9. LIANG, Licheng, 2023. "Resilience of Japanese Multinational Enterprises' Production Networks during the COVID-19 Pandemic," Discussion Paper Series 742, Institute of Economic Research, Hitotsubashi University.
    10. Rinaldi, Marta & Bottani, Eleonora, 2023. "How did COVID-19 affect logistics and supply chain processes? Immediate, short and medium-term evidence from some industrial fields of Italy," International Journal of Production Economics, Elsevier, vol. 262(C).

    More about this item

    Keywords

    COVID-19; Global value chains; Supplier diversification; Diseases;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations

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