Trade Benefits and Environmental Costs of GVCS: A Case Study of the BRICS

As the international trading system has developed with the division of Global value Chains (GVCS), the export trade of Brazil, Russia, India, China, and South Africa (BRICS) has grown rapidly. The resulting growth of carbon emissions has drawn wide attention from the international community, necessitating the comparison of the trade benefits and environmental costs of the BRICS participation in GVCS. Based on the Eora database, this paper constructs a decomposition framework for the calculation of export value-added and embodied carbon, based on a multi-region input-output (MRIO) model. The trade benefits and environmental costs paid by the BRICS’ total exports from 1990 to 2015 were measured and the imbalance was analyzed, along with the causes. The results show that the main value-added and carbon embodied in the BRICS’ exports originate from their own countries, and the domestic value-added content of the BRICS’ exports decreased while the foreign value-added content increased.

Measuring aggregate trade costs and its empirical effects on manufacturing export composition in China

On the basis of measuring the bilateral trade costs between China and 86 trade partners and the aggregate trade costs from 2000 to 2013,this paper takes China’s vertical specialization reality into account,to do an empirical study on the impact of China’s aggregate trade costs on comparative advantages and export share of 17 two-digit ISIC manufacturing industries,and to conduct these types of robust tests in order to eliminate endogeneity bias.The results show that China’s aggregate trade costs are declining,but it is still 1/3 higher than that of developed countries of 10 years ago;bilateral trade costs between China and some countries even rise instead;aggregate trade costs are the determinants,not only of‘global’and‘local’comparative advantages,but also of export share of China’s manufacturing products,and its effect is stronger in industries with higher trade cost intensity.Therefore,we should consider the product composition on trade cost intensity and domestic value-added value(DVAR),and reduce trade costs in order to promote the export of products with higher domestic value-added rate,and to realize the substantial transformation of foreign trade growth mode.

Has Global Division of Labor Increased Markup of Chinese Enterprises?

The paper calculates the number of production stages for measurement of production segmentation,and discusses and depicts the microscopic impacts and effects of production segmentation of labor division of the global value chain on enterprise markup.The DLW method is used to calculate the markup of Chinese enterprises,the fi xed-effect model is used to analyze the impact of labor division of the global value chain on enterprise markup,and an instrumental variable method is constructed to relieve endogeneity.The research findings show that enterprises have significantly increased their markup by choosing global production segmentation,international production segmentation and domestic production segmentation.Global production segmentation can significantly increase the markup of low-productivity enterprises,hi-tech enterprises and private enterprises.Particularly,low-productivity enterprises choose international production segmentation and hi-tech enterprises choose domestic production segmentation.Production segmentation can offset to a certain extent low markup of export enterprises and domestic-oriented enterprises caused by the“competition effect”.In addition,enterprises’“technological progress effect”and“trade cost effect”are two possible channels by which production segmentation facilitates the increase of markup.The paper enriches and expands the literature about the impacts of labor division of the global value chain on enterprise markup,the robustness is analyzed from the perspectives of enterprise heterogeneity,industrial&technical heterogeneity and structure,and the impact mechanism is validated through the intermediate effect model.Our important findings are of important implications for solving the“low markup trap”of Chinese enterprises and enhancing labor division of the global value chain of enterprises.