Global Value Chains: Implications for the Austrian economy

Veronika Kulmer, Michael Kernitzkyi, Judith Köberl and Andreas Niederl

No VI-003, FIW Research Reports series from FIW

Abstract: This study focuses on the implications of rising global value chains (GVCs) on international trade and analysis the impacts on small open economies. Small open economies rely heavily on international trade and are highly integrated in global production networks but have so far been hardly considered in the literature. On the example of Austria, an industrialized small open economy in central Europe, we addressed the role of small open economies in a globalized economy. Based on the WIOD database we apply network analysis and use GVC as well as competiveness indicators to measure the associated risks as well as benefits. Findings imply for Austria a sharp turn in the focus of trade policy away from the traditional gross trade perspective. Austria’s competitiveness has been strengthened considerably via the participation in GVCs since resource and endowment constraints have been overcoming easier and foreign inputs are used in the production processes efficiently enabling vast economies of scale. Results also reveal that the promotion of service oriented activities which are a main source of the domestic value added content in manufacturing exports is of key importance for Austria’s competitiveness on the global market. In particular we found a mutual integration of EU enlargement countries of 2004 and Austria: Austria’s intermediate exports are mainly characterized by high knowledge- and service-intensive manufacturing goods, while the EU enlargement countries of 2004 specialize in low-skilled employment and less knowledge intensive services.

Keywords: input-output modelling; global value chains; international trade network; value added in trade (search for similar items in EconPapers)
JEL-codes: C67 F14 F68 O47 O52 (search for similar items in EconPapers)
Pages: 62
Date: 2015-04
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.fiw.ac.at/wp-content/uploads/2023/02/0 ... _Research_Report.pdf full text (application/pdf)
https://www.fiw.ac.at/wp-content/uploads/2023/02/0 ... cy_Note_german-1.pdf full text (application/pdf)
https://www.fiw.ac.at/wp-content/uploads/2023/02/0 ... Summary_german-1.pdf full text (application/pdf)
https://www.fiw.ac.at/wp-content/uploads/2023/02/0 ... _Research_Report.pdf full text (application/pdf)
none

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:wsr:ecbook:y:2015:m:04:i:vi-003

Ordering information: This working paper can be ordered from
FIW Project Office Austrian Institute of Economic Research Arsenal Objekt 20 A-1030 Vienna

Access Statistics for this paper

More papers in FIW Research Reports series from FIW
Bibliographic data for series maintained by ().