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The Great Collapse in Value Added Trade
Author(s) -
Nagengast Arne J.,
Stehrer Robert
Publication year - 2016
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/roie.12218
Subject(s) - economics , value (mathematics) , international economics , quarter (canadian coin) , final demand , international trade , econometrics , macroeconomics , production (economics) , mathematics , geography , statistics , archaeology
This paper studies the great collapse in value added trade using a structural decomposition analysis. We show that changes in vertical specialization accounted for more than 40% of the great trade collapse. Second, we find that the drop in the overall level of demand accounted for roughly a quarter of the decline in value added exports while just under one third was due to compositional changes in final demand. Finally, we demonstrate that the dichotomy between services and manufacturing sectors observed in gross exports during the great trade collapse is not apparent in value added trade data.

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