Fragmentation in Global Trade: Accounting for Commodities

Fragmentation in Global Trade: Accounting for Commodities
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Volume/Issue: Volume 2023 Issue 073
Publication date: March 2023
ISBN: 9798400236563
$20.00
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Topics covered in this book

This title contains information about the following subjects. Click on a subject if you would like to see other titles with the same subjects.

Exports and Imports , Economics- Macroeconomics , Economics / General , Commodities , international trade , sanctions , spillovers , fragmentation , trade elasticity , output loss , commodity production , trade fragmentation , trade linkages lead , Trade barriers , Commodity trade , Trade balance , Agricultural commodities , Global

Summary

We construct a new database which covers production and trade in 136 primary commodities and 24 manufacturing and service sectors for 145 countries. Using this new more granular data, we estimate spillover effects from plausible trade fragmentation scenarios in a new multi-country, multi-sector, general-equilibrium model that accounts for unique demand and supply characteristics of commodities. The results show fragmentation-induced output losses can be sizable, especially for Low-Income-Countries, although the magnitudes vary according to the particular scenarios and modelling assumptions. Our work demonstrates that not accounting for granular commodity production and trade linkages leads to underestimation of the output losses associated with trade fragmentation.