Specialization within global value chains: The role of additive transport costs
Rainer Lanz and
Roberta Piermartini
No ERSD-2018-05, WTO Staff Working Papers from World Trade Organization (WTO), Economic Research and Statistics Division
Abstract:
This paper studies the factors of comparative advantage within global value chains relying on a framework where comparative advantage is measured through the interaction of country and industry characteristics. We find that good institutions give a comparative advantage in the later stages of the production process, whereas good transport infrastructure gives an advantage in the early stages of production. We explain these results with a simple theoretical framework that shows how predicted patterns of specializations depend on whether trade costs are additive or multiplicative.
Keywords: global value chains; quality of transport infrastructure; quality of institutions; comparative advantage; upstreamness; production networks; trade costs (search for similar items in EconPapers)
JEL-codes: F13 F14 L60 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-int, nep-knm and nep-tre
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Citations: View citations in EconPapers (2)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:wtowps:ersd201805
DOI: 10.30875/f1276615-en
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