How does foreign demand activate domestic value added? A comparison among the largest euro-area economies

Rita Cappariello () and Alberto Felettigh

No 1001, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We propose an analysis for the largest euro-area countries (France, Germany, Italy and Spain), based on the framework developed by Koopman et al. (2014) for tracing value added in a country’s exports by source and use. We integrate their approach by introducing an additional dimension: the domestic-sector origin of value added embodied in exports. While providing an accurate picture of these countries’ participation in global value chains, we estimate the impact on their GDP of a shock to foreign demand and disentangle individual contributions along a geographical dimension in a period running from the introduction of the euro to the beginning of the sovereign debt crisis.

Keywords: global value chains; final internal demand; domestic value added activation; trade in value added (search for similar items in EconPapers)
JEL-codes: F14 F15 (search for similar items in EconPapers)
Date: 2015-01
New Economics Papers: this item is included in nep-eec and nep-int
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Citations: View citations in EconPapers (30)

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Persistent link: https://EconPapers.repec.org/RePEc:bdi:wptemi:td_1001_15

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