This paper unveils a systematic pattern in the People's Republic of China's (PRC) processing trade. In a cross-section of the PRC's provinces, the average distance traveled by processing imports (import distance) is negatively correlated with the average distance traveled by processing exports...

The core idea behind the paper is that trade policy matters for the organization of global value chains, a notion largely neglected by economists but which has important implications for our understanding of trade and the international transmission of trade policy shocks. We develop a...

The surge of oil prices in recent years has led to speculation that rising transportation costs could end the period of dramatic world trade growth - in the words of Rubin (2009), "…Your world is going to get a whole lot smaller." Using data from China's Customs Statistics, we examine the...

The collapse of trade during the great recession of 2008-2009 has raised the question of whether the rise of global value chains (GVCs) has increased or accelerated the international transmission of business cycle shocks. In this paper, we empirically investigate two channels through which a...

In the past few decades, East Asia has become a key player in the global value chains of products that are consumed in Western markets. In this paper, we discuss how idiosyncratic shocks propagate through global value chains, and assess how this has affected East Asian countries' vulnerability...

In a seminal contribution, Yi (2003) has shown that vertically specialized trade should be more sensitive to changes in trade costs than regular trade. Yet empirical evidence of this remains remarkably scant. This paper uses data from China's processing trade regime to analyze the role of trade...

The core idea behind the paper is that trade policy matters for the organization of global value chains, a notion largely neglected by economists but which has important implications for our understanding of trade and the international transmission of trade policy shocks. We develop a...

Previous studies have argued that global value chains (GVCs) have increased the sensitivity of trade to foreign income shocks. This may occur either because GVC trade is concentrated in durable goods industries, which are known to have high income elasticities (a composition effect), or because,...

In a seminal contribution, Yi (2003) has shown that vertically specialized trade should be more sensitive to changes in trade costs than regular trade. Yet empirical evidence of this remains remarkably scant. This paper uses data from China's processing trade regime to analyze the role of trade...

The core idea behind the paper is that trade policy matters for the organization of global value chains, a notion largely neglected by economists but which has important implications for our understanding of trade and the international transmission of trade policy shocks. We develop a...