Production Networks and “The Great Convergence”

Tadashi Ito
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Tadashi Ito: Faculty of International Social Sciences, Gakushuin University, Japan

Public Policy Review, 2020, vol. 16, issue 1, 73-94

Abstract: This paper shows that the gap between domestic production values and domestic value- added is growing with the deepening of production networks, which is a major phenomenon of economic globalization. Then, the utmost interest of this paper is analyzed: how the domestic value-added share change is related to total production value, number of employees, per-worker production value, and per-worker renumeration. The analyses show that the lowering of domestic value-added shares is related to increases in total production, number of employees, and per-worker production value. Moreover, it shows supporting evidence on the effect of the lower domestic value-added share on narrowing gaps in worker renumeration between the developed and developing countries, which is theoretically predicted by Baldwin (2016).

Keywords: Globalization; International fragmentation of production processes; value-added; Input-Output Database (search for similar items in EconPapers)
JEL-codes: F14 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:mof:journl:ppr16_01_04

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