World Input-Output Table

World Input-Output Table

Updated on Mar. 5, 2020

We have seen an increasing global integration through international trade and technological development across industries around the world. An accurate analysis of international economy requires comprehensive datasets that capture the dynamic interrelatedness of countries and industries. In 2009, the European Commission started the World Input Output Database (WIOD) project to increase our undesstanding of international trade in goods and services.

The core value of this project was the creation of the international Input-Output table. The table provides time-series data of the intermediate input values delivered across sectors worldwide at current prices, covering 27 EU countries and 14 major countries between 1995 and 2010. For each country, it details intermediate input and final output for 35 industries including agriculture, construction and manufacturing industries, and services industries. The table better captures the trade participation of each country by tracking the value-added at each stage of production, including upstream suppliers in the value chains.

This advantage lets us measure the formation of global value chains (GVCs) with the method created by Timmer ‘et al (2015), which transforms intermediate input values to value-added for every sector. In the equation, g is a SN-vector which represents the value added created in each of the SNcountry-industry involved in a value chain. v-hat is a vector of value added over gross output ratio. Leontief inverse inv(I-A) is used so that the value-added contributions by all tiers of suppliers are taken into account. Fe represents the summation vector of the final output of the good among all countries.

Then, the researchers calculated the foreign value added share of the total value added (compared g from foreign industries and domestic industries) to the industries of interest. They called this value FVAS(Foreign Value Added Share) and used as a measure of the industry’s dependency on Global Value Chains.

References

1. Timmer, M. P., Dietzenbacher, E., Los, B., Stehrer, R., & De Vries, G. J. (2015). An illustrateduser guide to the world input–output database: the case of global automotive production. Review of International Economics, 23(3), 575-605.

LEARN MORE about the project from their website.

Using this table, I have done the following two collaborative research projects at Macalester.

Case Study 1 - Measuring Valunerability of Japanese Manufacturing Industries to Foreign Natural Disaster Risk

We investigated if foreign natural disasters had any impacts on the Japanese manufacturing production and inventory data due to the expanding value-chain networks these industries are utilizing. I worked with Professor Felix Fiedt at Macaleste Department of Economics for this project over the summer of 2019.

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Case Study 2 - Macroeconomic Impacts of Joining the European Union for the New Member States

We looked at the changes in value-added exchanges among the 8 countries who joined the EU in the 2000s to see how their industry's economic relations to foreign industries changed over time. I worked with my classmate Venkat Somala '20 for this project in 2019.