make_exvadec {exvatools}

Decomposition of value added in exports using different methodologies

Description

Calculates the decomposition of value added in exports of a country or a group of countries according to different methodologies.

Usage

make_exvadec(
  wio_object,
  exporter = "all",
  method = "bm_src",
  output = "standard",
  quiet = FALSE,
  ...
)

Arguments

wio_object

An object of class wio (standardized world input-output table) obtained using make_wio().

exporter

String with a country or a country group code (e.g., "USA", "NAFTA", etc.). The default "all" produces the decomposition of value added in exports for all available individual countries.

method

A string specifying the export VA decomposition method:

• "bm_src": Borin and Mancini, source-based (2023) (default).

• "bm_snk": Borin and Mancini, sink-based (2023).

• "wwz": Wang et al. (2013).

• "kww": Koopman et al. (2014).

• "my": Miroudot and Ye (2021)

• "oecd": OECD (not properly a decomposition).

output

Type of matrices in output:

• "standard" (default): Shows the domestic content (DC), domestic value added (DVA), the domestic double counting (DDC), the foreign content (FC), the foreign value added (FVA) and the foreign double counting (DDC). The value added exported (VAX) is also produced in most cases, and additional indicators in some cases.

• "terms": Shows the basic decomposition terms, whose sum gives the value of gross exports. The number and specification of terms follows the standard in the economic literature: 12 in the Borin and Mancini (2019) decompositions (source and sink), 16 in the Wang et al. (2013) decomposition, 9 in the Koopman et al. (2014) decomposition and just 4 in the Miroudot and Ye (2021) decomposition (as the latter does not expand value added in terms of final absorption). \ Additional outputs:

• For the "bm_src" (Borin and Mancini, 2023, source-based) method there is an additional "basic" output, without GVC indicators. This output will replace "standard" if targeted perspectives (sector, bilateral or sector-bilateral) are selected.

• For the Miroudot and Ye (2021) method there is an additional "terms2" output, when world perspective is selected.

• For the "wwz" (Wang et al. ,2013) decomposition there is an additional "terms2" option with an alternative arrangement of the 16 terms.

• For the "oecd" decomposition there is an additional "tiva" output with several indicators of the OECD TiVA database.

quiet

Boolean, if TRUE, suppresses all status messages. Default is FALSE, i.e., messages are shown.

...

Additional parameters for targeted value added perspectives. These are only available for the "bm_src" (Borin and Mancini, 2023, source-based) and the "my" (Miroudot and Ye, 2021) decomposition. methods. Specific perimeters can be:

• partner String, for bilateral perspective. Default is "WLD", but any country or country group code (e.g. "USA" or "EU27") can be specified. In that case, all flows that cross the bilateral geographic perimeter more than once will be considered as double counting.

• sector String, for sector perspective. Default is "TOTAL", but any sector or sector group code (e.g. "MANUF") can be specified. In that case, all flows that cross the sector perimeter more than once will be considered as double counting. \ The bilateral and sector perspectives can be combined in a bilateral-sector perspective.

• perim Boolean (only for "my", and incompatible with sector or partner specifications). String, for general perimeter of value added. If perim = "WLD" (world) is specified (default is exporting country), then all flows that cross the border of any country more than once will be considered as double counting (unlike in the country perspective, where flows are considered as double counting only when they exit the border of the exporting country more than once). Please note that, when using the world perspective (perim = "WLD") and the terms output (output = "terms", the foreign double counting will be automatically divided into two elements ("terms2").

Value

A list object of class exvadec with several matrices plus metadata.

References

• Borin, A., & Mancini, M. (2023). Measuring What Matters in Value-Added Trade. Economic Systems Research, 1-25.

• Koopman, R., Wang, Z., & Wei, S.-J. (2014). Tracing Value-Added and Double Counting in Gross Exports. American Economic Review, 104(2), 459–494.

• Miroudot, S., & Ye, M. (2021). Decomposing Value Added in Gross Exports. Economic Systems Research, 33(1), 67–87.

• Wang, Z., Wei, S.-J., & Zhu, K. (2013). Quantifying International Production Sharing at the Bilateral and Sector Levels (NBER Working Paper No. 19677). National Bureau of Economic Research, Inc.

Examples

# Create a test wio
wio <- make_wio("iciotest")
# Make Borin and Mancini (2023) source decomposition for Spain
exvadec <- make_exvadec(wio, exporter = "ESP", method = "bm_src")
# Make Wang et al. (2013) decomposition for all countries
# expressed in the traditional 16 terms
exvadec <- make_exvadec(wio, method = "wwz", output = "terms")