Module description: Trade and Development. A Global Value Chain Analysis. The Case of the Mexican Economy

Module name

Trade and Development. A Global Value Chain Analysis. The Case of the Mexican Economy

Credit Points



Lectures (2 SWS)


Prof. Rosario Cervantes

Module Coordinator

Prof. Rosario Cervantes


The main idea of this seminar is to combine a theoretical-methodological workshop on the relationship between Trade and Economic Development with a presentation of some empirical results we have found for the Mexican economy. We will review some literature and methodological aspects of the following topics:
1. Trade and Development.
2. Trade in Gross Value vs. Trade in Value Added and Value Added in Trade.
3. Factor Content of Trade.
4. Trade and Income Distribution.

Learning objectives and skills

The main objective of the proposed workshop is twofold:
(1) That at the end of the workshop the student will be able to “reconsider” the benefits from trade at the eye of the Global Value Chain (GVC) analysis, in which at the theoretical and methodological levels we switch the perspective from trade in gross value to trade in value added; and from trade in goods to trade in tasks; in order to emphasize that benefits from trade will be those associated with job creation, labour compensations, and less inequality in income distribution.
(2) That the student will be able to apply some input-output techniques in order to understand the complexity on the relationship between trade and development.



Integration in curriculum

First or third semester (winter term)

Module compatibility

Regional, elective, or elective complementary module for: “M.A. Development Economics and International Studies”

Method of examination

Presentation and term paper.

Grading procedure

Presentation (33 % of the grade) and term paper (15 pages, 66 % of the grade)

Module frequency

Only in the winter semester 2018/2019

Resit examinations

Failed exams can be retaken twice.


Attendance: 32h
Self-study: 118h


1 semester

Teaching and examination


Recommended reading

• Chen, X., Cheng, L. K., Fung, K.C., Lau, L.J., Sung, Y., Yang, C., Zhuy, K., y Tang, Z. (2008). “Domestic Value Added and Employment Generated by Chinese Exports: A Quantitative Estimation, MPRA paper No. 15663
• Timmer, M., Erunban, A., Los, B., Stehrer, R., y de Vries, G. (2014) .Slicing up Global Value Chains. Journal of Economic Perspectives, Vol. 28, No. 2, pp. 99-118.
• World Bank Group, IDE-Jetro, OECD, UIBE, WTO (2017) Measuring and Analyzing the Impact of GVCS on Economic Development. Global Value Chain Development Report 2017.
• Lejour, A., Rojas-Romagosa, H., and Veenendaal, P. (2012) The Origins of Value in Global Production Chains.
• Timmer, M. P., Dietzenbacher, E., Los, B., Stehrer, R. and de Vries, G. J. (2015), An Illustrated User Guide to the World Input–Output Database: the Case of Global Automotive Production, Review of International Economics., 23: 575–605
• Fajgelbaum, Pablo D. and Amit K. Khandelwal (2016). Measuring the Unequal Gains From Trade. The Quarterly Journal of Economics, 131(3), 1113-1180.
• Escaith, H. (2014)“Mapping global value chains and measuring trade in tasks”, in Asia and Global Production Networks Implications for Trade, Incomes and Economic Vulnerability edited by B. Ferrarini and D. Hummels, Edward Elgar.
• Fujii, G., and Cervantes, R. (2013) “Mexico: value added in exports of manufactures”, CEPAL Review, 109.
• Fujii, G., Cervantes, R., and Fabián A. (2016) “The labour content of Mexican manufactures, 2008 and 2012”, CEPAL Review, 119.
• Fujii, G., and Cervantes, R. (2017)“The weak linkages between processing exports and the internal economy. The Mexican case”. Economic Systems Research, 2017, Vol.29
• Cervantes, R., Villaseñor, J., and Romero, M. (2016)“NAFTA trade (and some extra NAFTA trade) in value added and its distribution, 1995-2011”, Journal of Economic Structures, November, 2016, 5:27

Last modified

September 2018