Working Paper: CEPR ID: DP18301
Authors: Emmanuel B. Mensah; Johannes Van Biesebroeck
Abstract: We study the geographic concentration of trade flows of African countries using information on the global input-output structure of trade from the Eora database. Most countries show a similar concentration between close-by vs. long-distance trade in their foreign input sourcing as in their export sales. However, changes over the last two decades indicate that many countries increasingly focus their long-distance trade on only one of these two dimensions. This trend is most pronounced in manufacturing industries with stronger global value chains. In line with the learning-by-exporting hypothesis, export success on distant markets is a leading predictor (Granger causes) of regional export success. Only in light manufacturing do we find some evidence of a reverse pattern, i.e., regional exports preceding global exports.
Keywords: GVC; upgrading; Granger causality
JEL Codes: F14; R11
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| distant export success (F10) | regional export success (F14) |
| regional export success (F14) | distant export success (F10) |
| regional export success (F14) | long-distance export success (F10) |
| distant export success (F10) | competitiveness in regional markets (L10) |
| regional export success (F14) | global export success (F10) |