Course information

This short course will focus on the study of multinational firm activity with a special emphasis on global value chain (GVC) activity. I will discuss theoretical and empirical approaches as well as “micro” and “macro” approaches to the study of GVCs. On the empirical front, I will begin reviewing several variants of the “macro approach” to measuring the relevance of GVCs in the world economy, and I will also offer a critical evaluation of the country- and industry-level datasets (or World Input Output Tables) that have been used to date. I will next discuss the advantages and disadvantages of a burgeoning alternative “micro approach” that has instead employed firm-level datasets to document the ways in which firms have sliced up their value chains across countries. On the theoretical front, I will propose an analogous dissection of the literature. First, I will review a vast body of work developing country- and industry-level quantitative frameworks that are easily calibrated with World Input Output Tables, and that open the door for counterfactual exercises with minimal demands on estimation. Second, I will overview micro-level frameworks that have treated firms rather than countries or industries as the relevant unit of analysis, and that have unveiled a number of distinctive mechanisms by which GVCs shape the determinants and consequences of international trade flows in ways distinct from traditional models of international trade. I will close the lecture with a discussion of a still infant literature on the desirability and effects of trade policy in a world of GVCs. The substance of the course will be applied to understanding the recent drastic changes in the global landscape.

• Measuring global production sharing in the world economy via World Input-Output Tables
• Firm-level empirical approaches to GVC participation
• GVC and quantitative trade theory. The view from Macro
• Micro-level approaches to modelling GVCs
• GVCs and trade and industrial policy
• The Future of Globalization