Economics at your fingertips  

Measuring Smile Curves in Global Value Chains

Bo Meng, Ming Ye and Shang-Jin Wei

Oxford Bulletin of Economics and Statistics, 2020, vol. 82, issue 5, 988-1016

Abstract: The logic of the ‘smile curve’ in the context of global value chains (GVCs) has been widely used in case studies of individual firms, but rarely identified at the country‐industry level by using real data. This paper puts forward a proposal, based on an inter‐country input–output model, to consistently measure both the gain of value added and the position of countries and industries when they join GVCs. This allows for better identification and mapping of economy‐wide smile curves in a given conceptual value chain. Using the World Input‐Output Tables, we identify the Information and Communications Technology exports‐related smile curves for China and the United States (US), which provide an intuitive and visual representation of who gains value added and jobs through joining GVCs, and to what extent. Further insight into the distributional implications of GVC expansion, based on our analysis of labour markets for China and the US, provides a strong support for the so‐called ‘Paradoxical Pair of Concerns’ between developed and developing countries. Our empirical results show that gains through joining GVCs may vary greatly across different skill levels of labour domestically, a fact that has, at least in part, been a driver of the backlash against globalization and the rise of trade protectionism.

Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

Downloads: (external link)

Related works:
Working Paper: Measuring smile curves in global value chains (2015) Downloads
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:

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0305-9049

Access Statistics for this article

Oxford Bulletin of Economics and Statistics is currently edited by Christopher Adam, Anindya Banerjee, Christopher Bowdler, David Hendry, Adriaan Kalwij, John Knight and Jonathan Temple

More articles in Oxford Bulletin of Economics and Statistics from Department of Economics, University of Oxford Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().

Page updated 2021-10-14
Handle: RePEc:bla:obuest:v:82:y:2020:i:5:p:988-1016