International Comovement in the Global Production Network

• 成果类型: Article
• 署名作者: Huo, Zhen; Levchenko, Andrei A.; Pandalai-Nayar, Nitya
• 署名单位: Yale University; University of Michigan System; University of Michigan; National Bureau of Economic Research; Centre for Economic Policy Research - UK; University of Texas System; University of Texas Austin
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdae033
• 发表日期: 2024
• 页码: 365-403
• 关键词: business-cycle; vertical specialization; demand shocks; TRADE; input; transmission; WORLD; output; GROWTH; TECHNOLOGY

摘要

This article provides a general framework to study the role of production networks in international GDP comovement. We first derive an additive decomposition of bilateral GDP comovement into components capturing shock transmission and shock correlation. We quantify this decomposition in a parsimonious multi-country, multi-sector dynamic network propagation model, using data for the G7 countries over the period 1978-2007. Our main finding is that while the network transmission of shocks is quantitatively important, it accounts for a minority of observed comovement under the estimated range of structural elasticities. Contemporaneous responses to correlated shocks in the production network are more successful at generating comovement than intertemporal propagation through capital accumulation. Extensions with multiple shocks, nominal rigidities, and international financial integration leave our main result unchanged. A combination of TFP and labour supply shocks is quantitatively successful at reproducing the observed international business cycle.