Is Sweden competitive in Global value chains? This report introduces a novel value-added measure of country competitiveness in global value chains. Using this measure, the development of Swedish competitiveness in global value chains is analyzed. Implications of using different measurements of competitiveness are discussed.
Production processes have become increasingly fragmented across national borders. This changes the nature of international competition. As a consequence conventional indicators of competitiveness based on gross exports are increasingly less informative.
In this report we use a new analytical tool that measures the incomes and jobs being generated by Sweden in Global Value Chains (GVC). GVCs are identified by tracing the flow of goods and services across industries and countries as described in a world input-output table. This allows us to trace the incomes from labour and capital that is directly and indirectly generated in the production of final manufacturing goods. The analysis is based on a new database, called the World Input-Output Database that combines national input-output tables, bilateral international trade statistics and data on production factor requirements.
Using this database the report details the main trends in GVC income and jobs in Sweden from 1995 to 2011.
The analysis shows that a GVC perspective on competitiveness is essential for advancing the policy debates on how to measure competitiveness and the causes and consequences of globalization.
Competing in Global Value Chains – Implications for Jobs and Income in Sweden