We investigate whether global value chains have increased the sensitivity of Chinese trade to foreign income shocks. This may occur through either composition or supply chain effects. We find evidence for the former, but not the latter.

This paper analyzes to what extent East Asia¡¯s integration into global value chains (GVCs) has made the region more vulnerable to business cycle shocks in the West. We identify different channels through which business cycle shocks in the West can propagate to East Asian countries via global...