Open AccessComplex Network Analysis for Characterizing Global Value Chains in Equipment Manufacturing
Author(s) -
Hao Xiao,
Tianyang Sun,
Bo Meng,
Lihong Cheng
Publication year - 2017
Publication title -
plos one
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.99
H-Index - 332
ISSN - 1932-6203
DOI - 10.1371/journal.pone.0169549
Subject(s) - sophistication , outsourcing , interdependence , industrial organization , fragmentation (computing) , production (economics) , international trade , value (mathematics) , economics , economic geography , business , global value chain , computer science , microeconomics , comparative advantage , marketing , social science , machine learning , sociology , political science , law , operating system
The rise of global value chains (GVCs) characterized by the so-called “outsourcing”, “fragmentation production”, and “trade in tasks” has been considered one of the most important phenomena for the 21st century trade. GVCs also can play a decisive role in trade policy making. However, due to the increasing complexity and sophistication of international production networks, especially in the equipment manufacturing industry, conventional trade statistics and the corresponding trade indicators may give us a distorted picture of trade. This paper applies various network analysis tools to the new GVC accounting system proposed by Koopman et al. (2014) and Wang et al. (2013) in which gross exports can be decomposed into value-added terms through various routes along GVCs. This helps to divide the equipment manufacturing-related GVCs into some sub-networks with clear visualization. The empirical results of this paper significantly improve our understanding of the topology of equipment manufacturing-related GVCs as well as the interdependency of countries in these GVCs that is generally invisible from the traditional trade statistics.