GVC journeys: Industrialisation and deindustrialisation in the age of the second unbundling

Richard Baldwin, Toshihiro Okubo

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

Offshoring and participation in global value chains (GVCs) are critical to understanding the rapid deindustrialisation of G7 nations and the rapid industrialisation of a handful of developing nations. This paper distinguishes between trade in final goods and trade in parts to track the shifting pattern of the location of manufacturing. We introduce a simple empirical measure of comparative advantage in parts on one hand and in final goods on the other. We illustrate how this distinction can help organise thinking on the patterns of industrialisation and deindustrialisation—namely the ‘GVC journeys’ of advanced and emerging economies. We also provide one simple model. The model highlights the interactions of trade costs and the knowledge transfers to accompany offshoring of parts production and assembly, which we call trade-led versus knowledge-led globalisation.

Original languageEnglish
Pages (from-to)53-67
Number of pages15
JournalJournal of The Japanese and International Economies
Volume52
DOIs
Publication statusPublished - 2019 Jun 1

Fingerprint

de-industrialization
value chain
industrialization
knowledge transfer
manufacturing
globalization
participation
economy
costs
interaction
Industrialization
Global value chains
Unbundling
Deindustrialization
Offshoring

Keywords

  • Fragmentation
  • Globalisation
  • Knowledge-led globalisation
  • Parts and components trade

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics
  • Political Science and International Relations

Cite this

GVC journeys : Industrialisation and deindustrialisation in the age of the second unbundling. / Baldwin, Richard; Okubo, Toshihiro.

In: Journal of The Japanese and International Economies, Vol. 52, 01.06.2019, p. 53-67.

Research output: Contribution to journalArticle

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