Pandemic trade: COVID‐19, remote work and global value chains
This paper studies the trade effects of COVID‐19 using monthly disaggregated trade data for 28 countries and multiple trading partners from the beginning of the pandemic to June 2020. Regression results based on a sector‐level gravity model show that the negative trade effects induced by COVID‐19 sh...
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| Published in: | World economy Vol. 45; no. 2; pp. 561 - 589 |
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| Main Authors: | , , , , |
| Format: | Journal Article |
| Language: | English |
| Published: |
England
Blackwell Publishing Ltd
01-02-2022
John Wiley and Sons Inc |
| Subjects: | |
| Online Access: | Get full text |
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| Summary: | This paper studies the trade effects of COVID‐19 using monthly disaggregated trade data for 28 countries and multiple trading partners from the beginning of the pandemic to June 2020. Regression results based on a sector‐level gravity model show that the negative trade effects induced by COVID‐19 shocks varied widely across sectors. Sectors more amenable to remote work contracted less throughout the pandemic. Importantly, participation in global value chains increased traders’ vulnerability to shocks suffered by trading partners, but it also reduced their vulnerability to domestic shocks. |
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| Bibliography: | Funding information This paper has benefited from support from the World Bank’s Umbrella Facility for Trade trust fund financed by the governments of the Netherlands, Norway, Sweden, Switzerland and the United Kingdom. Nadia Rocha, Senior Economist, World Bank dwinkler2@worldbank.org amattoo@worldbank.org mruta@worldbank.org The findings, interpretations and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent. We are grateful to Cristina Constantinescu for help with the data and to Caroline Freund and seminar participants at the World Bank for valuable comments and suggestions. Errors are our responsibility only. Alvaro Espitia, Consultant, World Bank aespitia@woldbank.org Michele Ruta, Lead Economist, World Bank Aaditya Mattoo, Chief Economist East Asia and Pacific, World Bank nrocha@worldbank.org Deborah Winkler, Senior Consultant, World Bank ObjectType-Article-2 SourceType-Scholarly Journals-1 ObjectType-Feature-3 content type line 23 ObjectType-Review-1 We are grateful to Cristina Constantinescu for help with the data and to Caroline Freund and seminar participants at the World Bank for valuable comments and suggestions. Errors are our responsibility only. Alvaro Espitia, Consultant, World Bank (aespitia@woldbank.org); Aaditya Mattoo, Chief Economist East Asia and Pacific, World Bank (amattoo@worldbank.org); Nadia Rocha, Senior Economist, World Bank (nrocha@worldbank.org); Michele Ruta, Lead Economist, World Bank (mruta@worldbank.org); Deborah Winkler, Senior Consultant, World Bank (dwinkler2@worldbank.org). The findings, interpretations and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent. |
| ISSN: | 0378-5920 1467-9701 |
| DOI: | 10.1111/twec.13117 |