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Deep Trade Agreements and Global Value Chains
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Deep Trade Agreements and Global Value Chains
Deep Trade Agreements and Global Value Chains
Journal Article

Deep Trade Agreements and Global Value Chains

2020
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Overview
A prominent argument as to why countries sign “deep” preferential trade agreements (PTAs) is to foster global value chains (GVCs) operations. By exploiting a new dataset on the content of PTAs, this paper quantifies the positive impact of deep PTAs on GVC participation, mostly driven by value-added trade in intermediate rather than in final goods and services. On average, each additional policy areas increases the domestic and the foreign value added of intermediates by 0.48 and 0.38%. Deep PTAs facilitate integration in industries with higher levels of value added. Their content also matters for GVC integration by income group.
Publisher
Springer Science + Business Media,Springer US,Springer Nature B.V