Trade in Value‐Added and the Welfare Gains of International Fragmentation

Arnold Njike
Additional contact information
Arnold Njike: UP1 UFR02 - Université Paris 1 Panthéon-Sorbonne - École d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique

Post-Print from HAL

Abstract: ABSTRACT This study examines the overall impact of international production fragmentation on the welfare gains from trade. Using a novel model that accounts for shifts in preferences between local and foreign goods and distinguishes between intermediate and final goods trade, we gain a more nuanced understanding of how fragmentation shapes these welfare gains. Our findings challenge earlier estimates, showing that international fragmentation contributes around 20% to trade‐related welfare gains, a significantly smaller impact than previously believed. This result highlights the importance of considering changing consumer preferences, which can reduce the projected advantages of global supply chain integration.

Date: 2025
References: Add references at CitEc
Citations:

Published in Review of International Economics, inPress, ⟨10.1111/roie.70012⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05346427

DOI: 10.1111/roie.70012

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().