In this paper, we “slice up the global value chain” using a decomposition technique that has recently become feasible due to the development of the World Input-Output Database. We trace the value added by all labor and capital that is directly and indirectly needed for the production of final manufacturing goods. The production systems of these goods are highly prone to international fragmentation as many stages can be undertaken in any country with little variation in quality. We seek to establish a series of facts concerning the global fragmentation of production that can serve as a starting point for future analysis. We describe four major trends. First, international fragmentation, as measured by the foreign value-added content of production, has rapidly increased since the early 1990s. Second, in most global value chains there is a strong shift towards value being added by capital and high-skilled labor, and away from less-skilled labor. Third, within global value chains, advanced nations increasingly specialize in activities carried out by high-skilled workers. Fourth, emerging economies surprisingly specialize in capital-intensive activities.

The diffusion of information and communication technology (ICT) has witnessed a surge in recent years. The rate of adoption across countries diverges considerably regardless of the income levels. In this paper, we attempt to explain the differences in ICT adoption rates across countries by using Hofstede's cultural framework. The effect of culture on ICT adoption is explored by applying two different measures of ICT adoption, namely the average share of ICT spending in GDP across 42 countries, and per capita computer across 49 countries. The results suggest that the national culture and the ICT adoption rate of a country are closely related. It appears that most of the Hofstede dimensions are important in influencing ICT adoption, thereby confirming our hypotheses. In particular, the power distance and the uncertainty avoidance dimensions seem to be the most important ones. These results are robust in both datasets, even after controlling for levels of education and income

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a b s t r a c t de Vries, Gaaitzen J., Erumban, Abdul A., Timmer, Marcel P., Voskoboynikov, IlyaDeconstructing the BRICs: Structural transformation and aggregate productivity growth This paper studies structural transformation and its implications for productivity growth in the BRIC countries (Brazil,

Using detailed sectoral data from India KLEMS, we analyze the role of structural change in determining India's aggregate productivity growth during 1980-2011. In general, the impact of static structural change on aggregate labor productivity growth has been positive, as workers moved to sectors of a relatively higher labor productivity level. However, dynamic reallocation effects-worker movement to fast-growing industries-have not been observed. The pro-market reforms in the 1990s did help a TFP growth-enhancing allocation of capital across sectors. The relative importance of the manufacturing sector for aggregate TFP growth has increased in recent years. Yet, India's structural transformation features the absorption of workers in the construction sector and slow and stagnant job creation respectively in services and manufacturing sectors. This poses a challenge, as the potential for productivity growth in construction and services are limited, and the changing nature of manufacturing production provides less room for absorbing less-skilled workers.

Using nationally representative survey data of Indian manufacturing enterprises spanning the period 1995-2006, we analyze the link between formal sector subcontracting and informal sector employment. A novelty in our analysis is that this relationship is allowed to differ between modern and traditional segments of the informal sector. We show that formal sector subcontracting is positively related to employment growth only in the most modern segments of the informal sector. Increased subcontracting cannot explain the persistently high employment in traditional informal manufacturing activities in India. Instead, subcontracting can contribute to job creation in relatively modern segments of the informal sector. JEL codes: J21, O14, O17

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This paper estimates service lifetimes for capital assets in Dutch manufacturing industries, using information on asset retirement patterns. A Weibull distribution function is estimated using a nonlinear regression technique to derive service lifetimes for three selected asset types: transport equipment, machinery and computers. For this purpose, benchmark capital stock surveys for different two-digit industries are linked to annual discard surveys. On average the estimated lifetimes are 6, 9 and 26 years for transport equipment, computers and machinery, respectively. However, these estimates vary across industries. A comparison of our estimates with Canadian, U.S. and Japanese estimates shows notable differences in the lifetimes of all the asset types, with machinery showing the largest difference.