Decomposition of GDP by country/industries Which types of value-adaedproduction and trade activities belong to GVC? VAX(J&N)=2+30 A country/sector's total ahue-added Production for foreign demand (GDP by ndustry) 1+3b=Production for domestic demand D VA(KWW)=2+3=GDP in exports In production of fnal In production of value In production of vahe- oducts to domesti added in fial goods added in ntermediate market directiy drectly 1-V D 2-V RT In intermediates indirectly In intermediates directly In intermediates that absorbed by importing absorbed by direct finally return to home country or re-exported to countries third countries 3a-V GVC R 3b.V GVC D=RDV F L V GVC F Simple cross country Complex cross cour production sharing production sharing
Decomposition of GDP by country/industries Which types of value-added production and trade activities belong to GVC? VAX(J&N) =2+ 3c= Production for foreign demand ; 1+3b =Production for domestic demand. DVA(KWW) = 2 + 3 = GDP in exports ; . Complex cross country production sharing A country/sector’s total value-added (GDP by industry) In production of value added in final goods exports directly 2-V_RT In production of final products to domestic market directly 1-V_D In intermediates that finally return to home countries 3b.V_GVC_D=RDV_F In production of valueadded in intermediate exports 3-V_GVC In intermediates indirectly absorbed by importing country or re-exported to third countries 3c.V_GVC_F In intermediates directly absorbed by direct importers 3a-V_GVC_R Simple cross country production sharing 0 1 1 ≥2
Decompose final goods production by country/sector Which partoffinal goodsproduction and trade activities belong to GVCs? Productionof final goods FVA(LoS, Timmer and Vries)3a+3c DVA=1+2+3b Domestic VA consumed in Domestic VA in final Domestic and foreign VA domestic market directly 1-￥D 2-￥RT 3-Y GVC Partner VA in intermediate Domestic VA in imports consumed directly intermediates VA orts that re- intermediate trade Source country exported 3c. Y GVC F 3a-Y GVC R 3b.Y GVC D Shallow cross country Deepercross country
Decompose final goods production by country/sector Which part of final goods production and trade activities belong to GVCs? Shallow cross country production sharing Deeper cross country production sharing Production of final goods by country/sector Domestic VA in final product exports 2-Y_RT Domestic VA consumed in domestic market directly 1-Y_D Domestic VA in intermediates imports that reexported 3b. Y_GVC_D Domestic and foreign VA in intermediate inputs 3-Y_GVC Foreign VA in intermediate trade 3c. Y_GVC_F Partner VA in intermediate imports consumed directly by Source country 3a-Y_GVC_R 0 1 1 ≥2 FVA(Los, Timmer and Vries)=3a+3c DVA = 1+2+3b
Returned value added as share of total gvc related activities The relative sizes of parts R, D, and F may reflect the differences of roles in the gvcs for different countries a For example, GVC D, "returned DVA"accounts for a relatively larger proportion in the US, as the us is controlling both ends (design and sales) of the value chain GVC D/(GVC R+GVC D+GVC F) 90960 4% 1% n USA DEU CHN FRA GBR JPN ITA MEX CAN ESP RUS AUS KOR IND BRA
The relative sizes of parts R, D, and F may reflect the differences of roles in the GVCs for different countries. For example, GVC_D, “returned DVA” accounts for a relatively larger proportion in the US, as the US is controlling both ends (design and sales) of the value chain. Returned Value Added as share of total GVC related activities
Numerical results 口 Country Level Figure 3 Forward/Backward Participation Indexes, 2000 to 2014 Forward-Linkage GVC Participation Backward-Linkage GVC Participation 计时 20002002200420062008201020122014 0002002200420062008201020122014 USA --CHN --JPN -RUS -USA --CHN --JPN --RUS
Numerical Results Figure 3 Forward/Backward Participation Indexes, 2000 to 2014 Country Level
Figure 4 GVC participation Indexes, Country Level, 2014 工 NOR RUS MLT AUS●
Figure 4 GVC participation Indexes, Country Level，2014