measuring trade in value-added paris, november 2011 measuring trade in value-added oecd working...
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Measuring Trade in Value-AddedMeasuring Trade in Value-AddedOECD Working Party on Trade in Goods and Services
Paris, November Paris, November 20112011
Contact: [email protected]
Trade in Value-Added• Increasing recognition that gross estimates
of trade may create ‘misleading perceptions’ (Pascal Lamy), and imperfect policies in a number of areas, including:– dealing with bilateral trade imbalances– dealing with the impact of macro-economic
shocks on supply-chains– understanding the importance of trade to jobs
• Leading to a call for new metrics that better respond to these issues.
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The iPod
Distribution of the value added
• 299 US$– 75$ profit to US (Apple)
– 73$ whls/retail US (Apple)
The Apple iPod = 299$ of Chinese ‘exports’ to US
http://blogs.computerworld.com/node/5724
– 75$ to Japan (Toshiba)– 60$ 400 parts from Asia– 15$ 16 parts from the US– 2$ assembly by China
Responding to needs
• IO tables provide a means to respond to these developments by measuring interconnectedness of trade and trade in value-added terms.
• A number of initiatives have been launched using interconnected IO tables ( a world IO table).
• Including a two-year project of the OECD (STD/TAD/STI).
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International Collaboration• Various initiatives pooling resources to identify best
practices for allocation of bilateral trade flows within IO tables.
• But recognition: • that a long-term approach is needed to ‘institutionalise’
estimates of trade in value-added. • And that its international nature requires the involvement
of an international agency or international consortia.
• Formalising collaboration with WTO and IDE-JETRO, and exploring closers links with USITC, UNSD &World Bank.
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Indicator & data sharing with IDE-JETRO and WTO in TiVA Project
Value added in trade “headline” indicator: • bilateral flows;
• by sector to the degree possible.
Common to WTO and the OECD: publically
available
Input-Output tables, methodological
assumptions and bilateral trade flow data
OECD “analytical” data on trade in services, trade by enterprise,
intangibles and income flows.
Shared by OECD and IDE-JETRO
OECD only
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What do we know now: Import contents of exports (2005)
Source: OECD Inter-country inter-industry model (March 2011)
Import contents of exports
8Source: OECD Inter-country I-O model, 2011
And globalisation continues apace
• As production processes continue to become more fragmented and chains become more interconnected.
• Processing trade increasing in China.
• Driven by technological advancement, reduced transaction costs and trade policy reform.
• Reinforcing the need for on-going and robust estimates
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Work Plan• Estimates can be produced now, but necessarily
require assumptions relating to BTD IO flows. • Much of the work over next two years will be in
improving the nature of these assumptions, by: • Developing improved estimates of BTD by Industry and
End-Use• Improving BTD by services• Using firm-level micro data• Decomposing value-added into ‘labour’ and ‘capital’ flows.• Contribution of intangibles (R&D and software)
• And investigating the scope to trace property income flows.
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Chinese High Tech Exports by Ownership(% of the total)
Source: OECD STI Scoreboard 2011. Data on intangible investment are based on COINVEST [www.coinvest.org.uk] and national estimates by researchers. Data for fixed investment are OECD calculations based on OECD, Annual National Accounts and EU KLEMS Databases, March 2010.
Tangibles vs. intangibles
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%
Machinery and equipmentSoftware and databasesR&D and other intellectual property productsBrand equity, firm-specific human capital, organisational capital
Investment in fixed and intangible assets as a percentage of GDP, 2006
What can WPTGS do?• Support the initiative & related
developments especially in:– Improving bilateral trade flows, particularly in
services– More detailed IO tables?
• Linking business statistics and trade registers (TEC)– Breakdowns by
» Export intensive» Import Intensive» Export-Import Intensive» Processors?» Foreign/domestic ownership?
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