Discussion Paper Details

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Title: On the Measurement of Upstreamness and Downstreamness in Global Value Chains

Author(s): Pol Antrąs and Davin Chor

Publication Date: December 2017

Keyword(s): Downstreamness, global value chains, Input-Output Tables and Upstreamness

Programme Area(s): International Trade and Regional Economics

Abstract: This paper offers four contributions to the empirical literature on global value chains (GVCs). First, we provide a succinct overview of several measures developed to capture the upstreamness or downstreamness of industries and countries in GVCs. Second, we employ data from the World Input-Output Database (WIOD) to document the empirical evolution of these measures over the period 1995-2011; in doing so, we highlight salient patterns related to countries' GVC positioning - as well as some puzzling correlations - that emerge from the data. Third, we develop a theoretical framework - which builds on Caliendo and Parro's (2015) variant of the Eaton and Kortum (2002) model - that provides a structural interpretation of all the entries of the WIOD in a given year. Fourth, we resort to a calibrated version of the model to perform counterfactual exercises that: (i) sharpen our understanding of the independent effect of several factors in explaining the observed empirical patterns in the period 1995-2011; and (ii) provide guidance for how future changes in the world economy are likely to shape the positioning of countries in GVCs.

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Bibliographic Reference

Antrąs, P and Chor, D. 2017. 'On the Measurement of Upstreamness and Downstreamness in Global Value Chains'. London, Centre for Economic Policy Research.