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GVC journeys: Industrialisation and Deindustrialisation in the Age of the Second Unbundling

Toshihiro Okubo and Richard Baldwin

No 2019-003, Keio-IES Discussion Paper Series from Institute for Economics Studies, Keio University

Abstract: Offshoring and participation in Global Value Chains (GVCs) are critical to understanding the rapid deindustrialisation of G7 nations and the rapid industrialisation of a handful of developing nations. This paper distinguishes between trade in final goods and trade in parts to track the shifting pattern of the location of manufacturing. We introduce a simple empirical measure of comparative advantage in parts on one hand and in final goods on the other. We illustrate how this distinction can help organise thinking on the patterns of industrialisation and deindustrialisation-namely the"GVC journeys" of advanced and emerging economies. We also provide one simple model. The model highlights the interactions of trade costs and the knowledge transfers to accompany offshoring of parts production and assembly, which we call trade-led versus knowledgeled globalisation.

Keywords: Globalisation; Knowledge-led globalisation; Fragmentation (search for similar items in EconPapers)
JEL-codes: F10 F20 F60 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2019-01-12
New Economics Papers: this item is included in nep-int and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Related works:
Journal Article: GVC journeys: Industrialisation and deindustrialisation in the age of the second unbundling (2019) Downloads
Working Paper: GVC journeys: Industrialisation and Deindustrialisation in the Age of the Second Unbundling (2019) Downloads
Chapter: GVC Journeys: Industrialisation and Deindustrialisation in the Age of the Second Unbundling (2018)
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