A Portrait of Trade in Value Added over Four Decades

Robert Johnson and Guillermo Noguera

No 22974, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We combine data on trade, production, and input use to document changes in the value added content of trade between 1970 and 2009. The ratio of value-added to gross exports fell by roughly 10 percentage points worldwide. The ratio declined 20 percentage points in manufacturing, but rose in non-manufacturing sectors. Declines also differ across countries and trade partners: they are larger for fast growing countries, for nearby trade partners, and among partners that adopt regional trade agreements. Using a multi-sector structural gravity model with input-output linkages, we show that changes in trade frictions play a dominant role in explaining all these facts.

JEL-codes: F1 F4 F6 (search for similar items in EconPapers)
Date: 2016-12
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (22)

Published as Robert C. Johnson & Guillermo Noguera, 2017. "A Portrait of Trade in Value-Added over Four Decades," The Review of Economics and Statistics, vol 99(5), pages 896-911.

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