Supply Chains and the Global Trade Elasticity
|Date:||13 April 2021|
Last week, the IMF Economic Review published a new paper by GGDC researchers Marcel Timmer, Bart Los and Gaaitzen de Vries, co-authored with wiiw's Robert Stehrer. The paper proposes a new way to account for changes in the global trade elasticity, the degree to which trade increases with global production. Using an input-output framework and World Input-Output Tables expressed in constant prices, changes in the volume of global trade can be associated with changes in supply chain configurations, changes in the composition of consumption and investment demand and changes in trade in final products. One of the main findings is that most supply chains continued to become more internationally fragmented after the crisis of 2008/2009, but at a lower pace than before.