Visualizing the services embodied in global manufacturing exports

Abstract

Nowadays, manufacturing products contain more service value, and this trend is reshaping the global merchandise trade network. Based on a global multi-regional input–output (GMRIO) model and network analysis, we calculate the value added of services embodied in global manufacturing exports and visualize their flows across economies and industries from 2005 to 2015. More specifically, we adapt the PageRank algorithm to select the crucial economies and present four types of networks – networks of the crucial (services) supplier economies and the major user economies for their manufacturing exports, in addition to networks of the crucial manufacturing exporter economies and the major (services) supplier economies for them – at both aggregate and sectoral levels. Our results suggest that at the aggregate level, though some developing economies, such as China, India, and Brazil, are playing an increasingly important role, developed economies still dominate the networks as major users and suppliers. At the industry level, wholesale and retail, other business sectors, and finance and insurance are often recognized as the major (services) suppliers, especially those industries in the United States, Germany, Japan, and France. By contrast, developing economies are more engaged in low value-added service industries, such as transportation and storage. Our findings highlight the importance of servitization in developing economies.