International Input-output Tables Research Articles

Export Competitiveness Enhancement Strategies for China’s Manufacturing Industry Based on Global Value Chains

Abstract The process of globalization is deepening, and the international division of labor has further evolved from the traditional pattern into the production mode of global value chains. This paper calculates the degree of participation in the global value chain of China’s manufacturing industry and analyzes the index of comparative explicit advantage of China’s manufacturing industry in each category, i.e., the NRCA index. The decomposition method of trade flows of intermediate goods is used to interpret the value added of trade based on the international input-output table. In accordance with OECD industrial classification, subdivide the manufacturing industries and evaluate the overall export competitiveness of China’s manufacturing industry. Propose the new explicit comparative advantage index (RCA_VA index) and carry out the overall measurement and the measurement of each technology level industry separately. From the point of view of the RCA_VA index of China’s manufacturing industry as a whole 1.29 < RCA_VA<1.44, the range of value changes is small. The RCA_VA index for low-tech, medium-low-tech and high-tech industries is 1.00 < RCA_VA < 2.00, and China’s manufacturing industries as a whole, as well as industries at all technology levels, have significant comparative advantages and a certain degree of competitiveness in the international market. For the development of export competitiveness of chemical and pharmaceutical products, transportation equipment, and other manufacturing industries, it is necessary to further enhance the segmentation of manufacturing industries and make targeted improvements.

An input trade model with Keynesian unemployment: Bridging a gap between trade theory and international Input–Output analysis

AbstractThis study presents a trade model with (1) intermediate inputs, (2) link commodities, and (3) Keynesian unemployment. The model has linear input coefficients, stable commodity prices, and short‐run adjustment of the quantity supplied on the occasion of demand changes, making it compatible with international input–output tables and analysis. Given production techniques, labor endowments, upper limits of unemployment rates, markup rates, and final demand in each country, this model specifies feasible trade patterns and determines commodity prices, wage rates, gross outputs, employment/unemployment rates, national income, income distribution, and trade volumes/values for each pattern. Starting with a two‐country, three‐commodity case, this model expands to a multi‐country, multi‐commodity case.

Tracing the regional dual value chains: Measurement on the production position and evidence from China

When there is insufficient internal and external impetus for developing countries’ economy, building a domestic and international dual circulation is conducive to promoting the regional industrial growth. On the basis of regional embedded international input-output tables, this paper extends the measurement framework of production position and proposes the concept of the dual value chain, which measure production position that unifies the national and global value chains from forward and backward industrial linkages. We decompose the national and global value chains into three categories and investigate the production position characteristics of China with a multi-dimensional perspective. Consistent evidence shows that a feasible path of technological progress in optimizing the production in value chains in which technological progress plays a crucial role on the pure national value chain across the high-tech manufacturing sector, the eastern and central regions. Their posterior probabilities are 0.96, 0.21and 0.86, respectively. Moreover, the impact on the dual production is nonnegligible that the posterior probability of technological progress on the eastern and central regions is 0.40 and 0.92. In addition, the impact of the Chinese economic stimulus program and technological progress on the economic crisis has a certain moderating effect. Our proposed evaluation framework sheds new light that national value chain production can boost economic growth，and further promote the coordinated of regional industries for developing countries.

동북아 역내 제조업의 글로벌 공급망 변화와 특징 분석

Purpose: This paper analyzes how the manufacturing supply chain has changed over the past 20 years according to the trilateral division of labor between Korea, China and Japan. Also, by measuring changes in the trade structure and competitiveness between Korea, China and Japan during the same period, the effect on the changes in the supply chain between the three countries is examined.
 Research design, data, and methodology: This study analyzes the trade structure, export competitiveness, and supply and distribution structure of 10 manufacturing industries in Korea, China and Japan. The analysis period was set from 2000 to 2020. The statistics use the UN Comtrade and the Asian International Input-Output Table. In the analysis of the trade structure between Korea, China and Japan. The Revealed Symmetric Comparative Advantage (RSCA) index was introduced to analyze the trade structure between Korea, China and Japan. And for the supply chain structure between the three countries, the Leontief inverse multiplier decomposition of the International Input-Output Analysis was used.
 Results: As a result of the analysis, it was observed that the supply chain of the manufacturing industry between Korea, China and Japan has changed to an interdependent structure since 2010, and the reason for this is that the production technology gap between the three countries has been greatly reduced. Accordingly, the supply chain of the manufacturing industry between the three countries has shifted from the past one-way dependence structure to a two-way dependence structure. In terms of industry, the deepening dependence among the three countries centered on electrical/electromechanical machinery, metal products, general machinery, chemical products, transportation machinery, precision machinery and textile products, which are key export industries for both Korea, China and Japan, means that the supply and distribution structure is being strengthened.
 Implications: Considering the relationship between the supply chain between Korea, China and Japan from 2000 to 2020, institutional integration, such as the trilateral FTA, is delayed, but functional integration is deepening due to interdependence and complementarity and increased production and trade. However, if trade frictions or disputes between Korea, China and Japan occur between specific countries, it is interpreted that this can lead to negative effects, so-called big losses, not only for the country concerned but also for the other country.

Does environmental regulation enhance firm's position in dual value chain? An analysis based on environmental information disclosure

Climbing the dual value chain (DVC) of parallel development in global and domestic value chains is an important channel to get rid of bottom solidification. Based on the data of international input-output tables after embedding provinces and decomposing value-added flow during 2003–2012, this article provides measurement for downstream or upstream embedding and division position indexes of A-listed firms. Then, theoretical framework of environmental regulation affecting DVC embeddedness is constructed, and the Environmental Information Disclosure (EID) trial implemented in 2008 is regarded as a quasi-natural experiment. The results show that EID enhances corporate division position in DVC by weakening downstream embeddedness and increasing upstream embeddedness, domestic firms are gradually transforming from low-end manufacturers to high-end designers. The effect works with a year lag in downstream embeddedness and lags 2 years in others. Heterogeneity analysis confirms that enhancement of division position is more sensitive in resource-rich cities with high marketization or labor-intensive firms and manufacturing or service sectors. Besides, we find that environmental regulation such as EID induces technological innovation for process upgrade, product improvement for quality upgrade and allocation optimization for function upgrade to transform the role and degree of firms embedding DVC.

INTERDEPENDENCE OF MANUFACTURING INDUSTRY BETWEEN KOREA AND ASEAN-5 COUNTRIES: ASIAN INTERNATIONAL INPUT-OUTPUT ANALYSIS

The purpose of this study is to analyze the interdependence of the manufacturing industry between South South Korea and ASEAN-5 countries. To conduct an international analysis for the manufacturing industries, an interregional input-output (IRIO) model is applied. The Asian International Input-Output Table (AIIO) provided by IDE-JETRO (2017) is employed and the spillover effects of manufacturing industry are compared in terms of inducement production, value added and backward/forward linkages. The results indicate that the production inducement outcome between Malaysia and South Korea and the effect of forward and backward linkage industry are high, and the dependence on industry is high. On the other hand, in terms of decomposition of value added exports to ASEAN from South South Korea in the manufacturing sector; Vietnam, Singapore, and Indonesia are the states where South South Korea's domestic value-added exports are high. The result shows that South South Korea is necessary to diversify economic cooperation between East Asian and ASEAN member states.

Trade networks and shock transmission capacity: a new taxonomy of Italian industries

Applying the social network analysis to domestic and international input–output tables, we position the Italian sectors within their trade networks to analyze their ability to transmit economic shocks within the economic system. In this context, we propose a new taxonomy that classifies sectors in terms of the extent to, and the speed at, which they tend to spread domestic and foreign impulses throughout the Italian economic system. Our results show a mismatch between the industries which have a central position within international trade network and industries which play a central role for the domestic propagation of shocks. In this vein, the capacity of transmitting stimuli from abroad is limited, weakening the possibility to benefit from positive shocks, even though it could partially provide a shelter from negative one in the international business cycle.

Detecting the nation-based characteristics of industries in the global input-output network of networks

Under the influence of national policies, development plans, and subsidies, industries from the same nation perform similarly and inherit a part of their nations' characteristics. Unlike the one-layer input-output network that treats industries as isolated, our model treats industries from the same nation as a relative tight community. Thus, the characteristics of industries are inherited from their nation, which is defined as the nation-based characteristics. To accurately account for the nation-based contributions of each industry, we construct a global input-output NoN (network of networks) model. The global input-output NoN is transformed from the international input-output tables based on hypermatrices and the network of networks model. Based on the global input-output NoN, we propose six nation-based indexes to assess different aspects of industries' nation-based contributions. Our network model and nation-based indexes are applied on the international input-output tables from 2010 to 2015. We confirm the applicability of our model and discover several interesting findings. Overall, the most important one is that some nonmanufacturing industries (e.g., health, education, and public administration) may be more critical than some significant manufacturing industries.

International Input-Output Tables as a Tool for Structured Analysis and Assessment of Stability in Russian Transport Sector

Abstract The article describes the uses of multi-input/multi-output systems, with the aim of assessment of structural changes and stability in the Russian transport sector. Empirical input-output data for the period between the years 2000 and 2014 are used. A basic model and overview of the literature are given. The article summarizes the assessment of structural changes and stability. The author gives his own vision of a state of the Russian transport sector. The analysis is carried out for the transport sector as a whole as well as for the various transport modes. Analytical and quantitative results are presented. Assessments of the dynamics of several key economic indicators of the Russian transport sector based on the model calculations are discussed. The indicators were compared based on World Input-Output Database (WIOD) version 2016. It is shown that the share of intermediate goods and services in the transport sector’s gross output fell, while the share of final goods increased from 2000 to 2014. But the share of air transport in the transport sector’s gross output as a whole was stable in 2000-2014.

Industrial policies of countries with abundant natural resources in the Association of Southeast Asian Nations and Pacific Alliance

This study evaluates the industrial policy geared toward generating added value in natural-resource-rich countries in the Association of Southeast Asian Nations (ASEAN) and the Pacific Alliance (PA). Using the international input-output tables published by the OECD (2018), we identify the position of each country-sector in global value chains (GVCs) that make intensive use of minerals, and we estimate, through the generalized method of moments, what factors have favored to a greater extent the generation of added value in the sectors that transform minerals, between 2005 and 2015. Horizontal industrial policies are found to have the greatest effect in PA economies because they are located in the initial links of GVCs, while vertical policies have favored industrial upgrading in ASEAN countries due to their prolonged sustainability.

Do Asian Countries Upgrade in Global Value Chains? A Novel Approach and Empirical Evidence

This paper examines the move into upstream and downstream global value chain (GVC) activities by 11 Asian countries. We use international input–output tables in combination with employment data and measure the number of workers in each country involved in manufactures GVC. Jobs are classified by business function based on occupational information, such as R&D, fabrication, logistics, sales and marketing. In most Asian countries, we find a faster employment increase in R&D and other support services relative to fabrication activities between 2000 and 2011. However, the participation in GVC and the pace of upgrading appears to differ substantially across Asian countries. We use a structural decomposition method to explore the role of trade, consumption and technological change in accounting for changes in countries' involvement in GVC.

Servicification in global value chains: Comparative analysis of selected Asian countries with OECD

AbstractThis paper investigates the trend of servicification in global value chains (GVCs). The degree of servicification is measured as the share of service value added in manufacturing exports. Service inputs are either from domestic market or from foreign countries, which are measured by the domestic servicification and the foreign servicification, respectively. Using the international input–output tables from 1995 to 2011, we estimate the degree of servicification across 61 countries with a focus on Asian nations which have been rarely studied in previous research. We observed an evident trend of servicification in manufacturing in the Asian countries, especially in the 16 countries associated with Regional Comprehensive Economic Partnership (RCEP). Asian countries tend to have a lower level of domestic servicification but a higher level of foreign servicification than OECD countries. We also identified five key factors in driving the trend of servicification. Countries with broader participation and lower positions in GVCs tend to have higher levels of foreign servicification in manufacturing. Improvements in information and communication technology (ICT) also raise the level of foreign servicification. However, countries with a larger supply of service workers, better regulation quality and less government governance have a higher level of domestic servicification in manufacturing.

Foreign trade barriers and jobs in global supply chains

This paper studies the impact of foreign barriers to goods and services trade on domestic jobs that are directly or indirectly related to trade flows. Using the ILO’s recently published estimates of the number of jobs in global supply chains, the empirical analysis in this paper largely confirms predictions derived from a theoretical model closely calibrated to actual data from international input-output tables. First, it identifies a sizeable cross-border impact of barriers to manufacturing trade not only on manufacturing jobs, but also on services jobs. Second, service trade barriers affect the number of jobs in both services and manufacturing. Third, spill-over effects of trade policy in one sector to jobs in other sectors have become more important over time. Based on this evidence, the paper shows the labour market consequences of the increased interconnectedness of countries and sectors through global supply chains, suggesting that trade policy can have significant external effects on foreign labour markets

Value added and participation in global value chains: The case of Spain

AbstractFollowing Koopman, Wang, and Wei and using the data and indicators derived from the international input–output tables of the World Input–Output Database, this paper addresses the participation of the Spanish economy and its sectors in global value chains (GVCs) during the period 1995–2011 and its implications for the value added content of trade. The analysis reveals the increasing integration of the country in GVCs and the heterogeneity between manufacturing and services in their vertical specialisation and their contribution to value added. This paper also explores the link between the use of foreign factors and export performance at the industry level and finds that this type of involvement in GVCs is positively correlated with increases in the domestic value added content of Spanish exports.

PERAN INDONESIA DALAM RANTAI NILAI GLOBAL PRODUK ELEKTRONIK

Globalization has transformed the structure of industry into global integration of socalled global value chains (GVCs). Some literatures suggest that electronic industry is known as a successful industry in establishing global value chain. Electronic industry is one of leading cluster in driving economic growth in Indonesia. This study aimed to analyze the role of Indonesia in electronic global value chain according to its share towards global electronic industry, linkages, and value added distribution. An input output analysis by using the Asian International Input Output Table 2005 was employed to analyze the share of each country in electronic global value chain, inter-sector linkages, value added, also output and income multiplier. The result showed that Indonesia had low participation in electronic global value chain. Indonesia’s output share was the lowest among all countries which resulted in low valueadded acquisition. Indonesia played the role as the input user from the various sectors. It is suggested that Indonesia electronic manufacture sector should be integrated with the input supplier sectors. Electronic computing equipment sector can be the main priority in enhancing Indonesia electronic manufacture sector since it has the biggest effect to economic growth. Keywords: electronic, global value chain, Indonesia, input output analysis

PERAN INDONESIA DALAM RANTAI NILAI GLOBAL PRODUK ELEKTRONIK

Globalization has transformed the structure of industry into global integration of socalled global value chains (GVCs). Some literatures suggest that electronic industry is known as a successful industry in establishing global value chain. Electronic industry is one of leading cluster in driving economic growth in Indonesia. This study aimed to analyze the role of Indonesia in electronic global value chain according to its share towards global electronic industry, linkages, and value added distribution. An input output analysis by using the Asian International Input Output Table 2005 was employed to analyze the share of each country in electronic global value chain, inter-sector linkages, value added, also output and income multiplier. The result showed that Indonesia had low participation in electronic global value chain. Indonesia’s output share was the lowest among all countries which resulted in low valueadded acquisition. Indonesia played the role as the input user from the various sectors. It is suggested that Indonesia electronic manufacture sector should be integrated with the input supplier sectors. Electronic computing equipment sector can be the main priority in enhancing Indonesia electronic manufacture sector since it has the biggest effect to economic growth. Keywords: electronic, global value chain, Indonesia, input output analysis

International Value-Added Linkages in Development Accounting

Development accounting evaluates how much of the variation in per-worker incomes across countries can be attributed to quantifiable factor endowments, and how much is due to unobserved TFP differences. We use a standard trade model to generalise the development accounting framework to a setting in which countries are open to trade, and consume both domestic and foreign value added. In addition to differences in factor endowments and TFPs, the generalised framework highlights differences in relative factor costs as source of real-income variation across countries. In turn, countries' relative factor costs are determined by their trade linkages, and the international distribution of factor endowments and expenditures. We use information on value-added trade from international input-output tables for 40 major economies in the period 1995-2011 to back out their relative factor costs in a model-consistent manner. Incorporating this information into the development accounting equation reduces the variation in unobserved TFPs required to explain the distribution of per-worker incomes among our sample countries by more than one half. Our findings suggest that the large international TFP differences found in traditional development-accounting exercises are in part due to their implicit assumption that countries are closed.

A Country-Specific Water Consumption Inventory Considering International Trade in Asian Countries Using a Multi-Regional Input-Output Table

Interest in the impacts of water use in the life cycle of products and services are increasing among various stakeholders. The water footprint is a tool to identify critical and effective points for reducing the impact of water use through the entire life cycle of products, services, and organizations. The purpose of this study was to develop a water consumption inventory database that focused on identifying of Asian water consumption using an input-output (IO) framework. An Asia International Input-Output table (AIIO) was applied in this study. The amount of water consumption required for agricultural products was estimated by modeling; for other sectors it was estimated from statistical reports. The intensities of direct water consumption in each sector were calculated by dividing the amount of water consumption by the domestic production. Based on the IO analysis using Leontief’s inverse matrix, the intensities of water consumption from cradle to gate were estimated for all goods and services. There was high intensity of water consumption in the primary industry sectors, together with a high dependency on rainwater as an input water source. The water consumption intensities generally showed a larger reduction in secondary sectors, in comparison with the tertiary sectors, due to the use of recycled water. There were differences between this study and previous studies due to the use of site-specific production data and the temporal resolution of crop production. By considering site-specific conditions, it is expected that the dataset developed here can be used for estimating the water footprint of products, services, and organizations in nine countries (Japan, South Korea, China, Taiwan, Thailand, the Philippines, Malaysia, Singapore, Indonesia, and USA).

Economic impacts of natural gas flow disruptions between Russia and the EU

In this paper we use a non-linear programming approach to predict the wider interregional and interindustry impacts of natural gas flow disruptions. In the short run, economic actors attempt to continue their business-as-usual and follow established trade patters as closely as possible. In the model this is modelled by minimizing the information gain between the original pattern of economic transactions and the situation in which natural gas flows are disrupted. We analyze four scenarios that simulate Russian export stops of natural gas by means of a model calibrated on an international input-output table with six sectors and six regions.The simulations show that at the lower levels of aggregation considerable effects are found. At the aggregate level of the whole economy, however, the impacts of the four scenarios are negligible for Europe and only a little less so for Russia itself. Interestingly, the effects on the size of the economy, as measured by its GDP, are predominantly positive for the various European regions, but negative for Russia. The effects on the welfare of the populations involved, however, as measured by the size of domestic final demand, have an opposite sign; with predominantly negligible but negative effects for European regions, and very small positive effects for the Russian population.

Development of Social Intensity Database Using Asian International Input–Output Table for Social Life Cycle Assessment

The social impacts of products and service life cycles are increasingly of interest among policy makers and stakeholders. Workers’ issues are considered to be a source of key inventory data to assess social impacts, and are crucial in moving towards social sustainability. There is a need to develop a social inventory database for evaluating social impacts of products and services. This study aimed at the development of a social intensity dataset using an input–output analysis framework. The 2005 Asian International input–output table is used in this work. Six social issues are considered: total employment, paid workers, vulnerable employment, wages, fatal, and non-fatal occupational injuries. To verify the acceptability of this study, an estimation of total social footprint deduced from final consumption rates was carried out. The social intensities associated with 10 countries and 76 economic sectors were constructed. The results show that the social intensities from cradle to gate the agricultural sector has the highest in terms of total employment and vulnerable employment. Meanwhile, the mining sector in China has a higher non-fatal and fatal occupational injuries than the agriculture sector, secondary sector, and tertiary sector. The public administration sector and the education and research sector had a higher wages intensity than any other sectors due to these sectors being labor intensive and having higher wages. The social intensity in terms of total employment, paid workers, vulnerable employment, non-fatal injuries, and fatal accident cases in the developing countries was higher than the developed countries whereas wages intensity in developing countries was lower than that of developed countries. The social footprints resulting from the final consumption of each country show that the social footprints had transferred from the developing countries to the developed countries. Exports from China to the USA, Japan, South Korea, Taiwan, and Singapore have a significant social impact in these countries.