Networks of Value-added Trade

International Trade Effects of Value-Added Taxation

Trade Costs and Gravity for Gross and Value Added Trade

Cross-border production fragmentation enables countries to export domestic value added not only directly in the form of gross exports of final goods, but also indirectly by participating in global supply chains. This paper studies the determinants of trade in value added. I incorporate the global input-output structure into an international trade model to derive an approximate gravity equation ...

Value-Added Taxes and International Trade: The Evidence

This paper examines the effect of value-added taxes (VATs) on international trade. Destination-based VATs are commonly thought to encourage exports, since exports are exempt from tax while imports are taxed. Economic theory implies that exchange rate adjustment prevents destination-based VATs from affecting exports and imports, since exchange rate appreciation completely undoes the effects of i...

Accounting for Intermediates: Production Sharing and Trade in Value Added∗

We combine input-output and bilateral trade data to quantify cross-border production linkages. Using a complete trading system, we compute bilateral trade in value added for 87 countries and regions. The ratio of value added to gross exports is a measure of the intensity of production sharing. Across sectors, manufacturing has a relatively low ratio and thus accounts for a smaller share of expo...

Measuring the Value Added by Money in Trade

The paper tests the proposition that money generates value in trade. It examines the data for 5,746 Russian companies for 1997 and finds that money accounts for 24.6 percent of their value-added. The functional form of the return on money in trade is determined to be positive and marginally declining. The paper imputes that Russian GDP lost 8.1 percent in 1997 because of diminished use of money...