| With globalization, firms changed the way they trade and interact. However, we still look at these flows with statistics of international trade that are considered inadequate or insufficient to understand this new reality. In this context, we contribute to evaluate one of the main aspects of globalization, namely the impact of Global Value Chains (GVCs). Firstly, we make use of the 2013 World Input-Output Database (WIOD) to estimate: (a) the participation of 40 major developed and emerging economies in GVCs between 1995 and 2011; (b) the most significant GVCs worldwide per sector, measured according to the value of the inputs internationally traded; and (c) the impact the international trade of inputs within GVCs in a given economy, both in terms of income and of employment, taking the example of the Portuguese economy. Secondly, we will propose four new indicators to measure the country-impact of GVCs, two related to the income transfer and two related to the labor content of the international trade of inputs, to estimate GVC-embeddedness and GVC-related net gains of countries. We will present the value-added of our indicators when compared to those found in the literature. Thirdly, we will run a pooled-regression model to estimate the main determinants of bilateral outflow stocks of Foreign Direct Investment (FDI). The regression shows that bilateral FDI inflow stocks are positively associated to the total income transferred between countries due to GVC-related bilateral trade of inputs, taken as a proxy to the degree of the embeddedness of those countries in GVCs, but not to the net gains of "transferred" income, taken as a proxy to an unbalanced participation in GVCs. |
