Vázquez López, Raúl
A icle
E olu ion o ade and p oduc i e in eg a ion in La in
Ame ica, 1995-2015: an inpu -ou pu analysis
Jou nal o Economics, Finance and Adminis a i e Science
P o ided in Coope a ion wi h:
Uni e sidad ESAN, Lima
Sugges ed Ci a ion: Vázquez López, Raúl (2024) : E olu ion o ade and p oduc i e in eg a ion
in La in Ame ica, 1995-2015: an inpu -ou pu analysis, Jou nal o Economics, Finance and
Adminis a i e Science, ISSN 2218-0648, Eme ald Publishing Limi ed, Leeds, Vol. 29, Iss. 58, pp.
229-245,
h ps://doi.o g/10.1108/JEFAS-09-2022-0202
This Ve sion is a ailable a :
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E olu ion o ade and p oduc i e
in eg a ion in La in Ame ica,
1995–2015: an inpu -
ou pu analysis
Ra
ul V
azquez-L
opez
Ins i u o de In es igaciones Econ
omicas, Uni e sidad Nacional Au
onoma de M
exico,
Ciudad de M
exico, M
exico
Abs ac
Pu pose –The main goal o his pape is o examine he e olu ion o La in Ame ican p oduc i e in eg a ion in
e ms o he egional alue added inco po a ed in in a- egional expo s o A gen ina, B azil, Chile, Colombia,
Mexico and Pe u. In addi ion, he s udy aces he ade and p oduc i e in eg a ion ajec o ies o each o hese
coun ies om 1995 o 2015.
Design/me hodology/app oach –Based on he use o OECD’s global ICIO inpu -ou pu ables, his pape
applies he me hodological amewo k by Wang e al. (2018) o he analysis o ade lows a he bila e al le el,
which allows b eaking down he alue o g oss expo s o each sec o -coun y, depending on he o igin o he
alue added con ained in expo s, as well as hei use.
Findings –The es ima es show e y low sha es o alue added om egional pa ne s in he in a- egional
expo s o he coun ies s udied. Con e sely, he weigh o he alue added inco po a ed in hese expo s by
coun ies ou side he egion has inc eased in andem wi h China’s expanding in ol emen in La in Ame ica.
This de elopmen , along wi h he downwa d end in domes ic alue added inco po a ed in expo s, indica es a
lack o a egional in eg a ion p ocess o any dep h.
O iginali y/ alue –This a icle add esses an economic p oblem o con en ional impo ance om a global
alue chain pe spec i e using a no el me hodology based on he use o global inpu –ou pu ables.
Keywo ds La in Ame ica, Value chains, Inpu -ou pu , Regional in eg a ion, Expo s
Pape ype Resea ch pape
1. In oduc ion
In La in Ame ica, he new global con ex —led by in e na ional o ganiza ions—ga e ise o a
new “open”in eg a ion pa adigm, wi h he p ima y goal o inc easing egional ade o os e
g ea e global in eg a ion, based on each coun y’s s a ic compa a i e ad an ages (B
e ola and
Ocampo, 2013). The es ablishmen o open ade and egional p e e ence zones was p oposed,
bu unlike he p e ious “closed”model, he e we e no ins umen s o p omo e p oduc i e
ans o ma ion wi h equi y (B ice~
no, 2013). These public policy guidelines mo i a ed he
o ma ion o NAFTA and MERCOSUR, as well as he egion’s leading economies’ac i e
pa icipa ion in hese ag eemen s (B azil, Mexico and A gen ina) (Bo o, 2019).
La in
Ame ican
p oduc i e
in eg a ion
229
JEL Classi ica ion —C67, F15, F63, O54, N76
©Ra
ul V
azquez-L
opez. Published in Jou nal o Economics, Finance and Adminis a i e Science.
Published by Eme ald Publishing Limi ed. This a icle is published unde he C ea i e Commons
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Recei ed 27 Oc obe 2022
Re ised 16 Augus 2023
1 No embe 2023
20 Feb ua y 2024
Accep ed 21 Feb ua y 2024
Jou nal o Economics, Finance and
Adminis a i e Science
Vol. 29 No. 58, 2024
pp. 229-245
Eme ald Publishing Limi ed
2077-1886
DOI 10.1108/JEFAS-09-2022-0202
Wi h he a i al o p og essi e go e nmen s a he beginning o he wen y- i s cen u y,
he e was a e u n—in e ms o ideological o ien a ion— o pos ula es based on p oduc i e
in eg a ion, as a means o p og essing in indus ializa ion p ocesses owa ds mo e
sophis ica ed modali ies and wi h g ea e echnological con en (CEPAL, 2014). While he
Boli a ian Alliance p omo ed an in eg a ion model based on solida i y, complemen a i y and
coope a ion, MERCOSUR’s agenda was empo a ily expanded o include issues ela ed o
coo dina ion and p oduc i e in eg a ion. In 2012, he c ea ion o he Paci ic Alliance, wi h an
“open”in eg a ion pe spec i e, e ealed a p ocess in luenced by na ional poli ical
luc ua ions consis ing o ee ade ag eemen s, egional and sub egional ag eemen s
wi h opposing app oaches and ma ked by he simul aneous pa icipa ion o one o mo e
coun ies in incompa ible in eg a ion ini ia i es (L
amba y, 2016).
In his ega d, La in Ame ican go e nmen s ha e sha ed he goal o o ming and
de eloping in e na ional p oduc ion linkages ha allow p og ess owa ds comple e
accumula ion o o igin. Fo ha pu pose, a consensus has eme ged o emb ace a mo e
mode n pe spec i e o he in eg a ion p ocess, ocusing on he issues o in eg a ion in he
p oduc ion base and de eloping egional o sub egional alue chains (CEPAL, 2014). A he
global le el, di e en na ional expe iences indica e ha a mo e signi ican sha e o expo s as
a pe cen age o GDP may no e lec long- e m p og ess in e ms o income, employmen o
de elopmen i i is no accompanied by inc eases in domes ic alue-added con en in expo s
(Banga, 2013). In his con ex , he bene i s o p oduc i e and ade in eg a ion mus be
e alua ed based on he alue added gene a ed in each loca ion.
Va ious au ho s (Wang e al., 2018;Johnson, 2014) ha e a gued ha ade s a is ics
measu ed in g oss e ms en ail a misin e p e a ion o he na u e o ade in eg a ion
phenomena, pa icula ly he ole o di e en coun ies, sec o s and p oduc i e ac o s in
global dynamics. Recen ly, he de elopmen o global inpu -ou pu ma ices and a ious
me hodologies based on hese new ins umen s has made i possible o ace he alue o
goods and se ices h ough he se o pa icipa ing coun ies and indus ies using bila e al
ade low analysis, and hus quan i y he con ibu ions o di e en s ages o p oduc ion o
he alue o he inal p oduc , as well as he dis ibu ion be ween coun ies o he bene i s
esul ing om he agmen a ion o he manu ac u ing p ocess (Johnson, 2014).
In ligh o his, he main goal o his a icle is o examine he e olu ion o La in Ame ican
p oduc i e in eg a ion in e ms o he egional alue added (RVA) inco po a ed in in a-
egional expo s o coun ies o which comple e and consis en da a is a ailable in he
OECD’s global inpu -ou pu ma ices (ICIO) (OECD, 2021) (A gen ina, B azil, Chile, Colombia,
Mexico and Pe u). In a second ins ance, he s udy uses wo axes o analysis o ace he ade
and p oduc i e in eg a ion ajec o ies o each o he coun ies om 1995 o 2015. The i s ,
based on ypical ade s a is ics, analyses he weigh o in a- egional expo s in he o al
expo ed; he second, based on a Global Value Chain app oach, assesses he RVA’s
pa icipa ion in in a- egional expo s, in o de o highligh he in olu ion eco ded in he
deg ees o complexi y o hese egional exchanges.
The ou line o he pape is as ollows: Following his in oduc ion, he second sec ion
discusses he main aspec s o economic in eg a ion heo ies abou de eloping coun ies and
La in Ame ica in pa icula , as well as he conce ns exposed on he issue o economic
in eg a ion in La in Ame ica wi hin he con ex o he o ma ion o Regional Value Chains
(RVCs). Then, a hi d sec ionde ails he calcula ions made om he me hodology de eloped by
Wang e al. (2018) (he eina e e e ed o as WWZ), as well as he s a is ical sou ces used. The
ou h sec ion conduc s a desc ip i e analysis o adi ional ade s a is ics, which unc ions as
a p elude o he p esen a ion o he in eg a ion ajec o ies o he s udied coun ies, in he i h
sec ion. The i h sec ion holds also a discussion on he b eakdown o in a- egional expo s
based on he o igin o he inco po a ed alue added and p esen s some heo e ical and policy
implica ions, ollowed by he esea ch’s key conclusions in he six h sec ion.
JEFAS
29,58
230
2. Theo e ical amewo k and li e a u e e iew
The amewo k o he heo y o economic in eg a ion as laid ou by Jacob Vine (1950) s ems
om he classical pe spec i e o sea ching o he mos e icien use o esou ces,
emphasizing he s a ic e ec s o he c ea ion and de ia ion o ade caused by he
libe aliza ion o comme ce (Asche, 2021). As he heo y de elops, pa icula ly wi h he
eme gence o he so-called “New T ade Theo y”(K ugman, 1980), he po en ial o di e en
dynamic e ec s o in eg a ion ha e been conside ed (inc ease o in es men expendi u e,
sus ainable inc ease o demand, consolida ion o p oduc ion and inc ease o i s specializa ion,
imp o emen o he o ganiza ion and managemen o p oduc ion and p oduc ion echnology,
a ionaliza ion o e i o ial dis ibu ion and u iliza ion o esou ces, inc ease o p oduc ion
e iciency, c ea ion o economic g ow h, e c.) (Ma ino , 2014).
In his ega d, se e al au ho s a gue ha hese heo ies a e inadequa e o analyzing he
speci ic case o economic ag eemen s be ween de eloping coun ies (DCs) (D ape , 2010).
Ma ino (2014) eg oups he main elemen s o in eg a ion o hese cases in o ou main
ca ego ies (gene al economic, ma ke - ela ed and ade- ela ed ac o s, and e ec s). Among he
gene al economic aspec s, we can highligh he need o pa ne s o coo dina e mac oeconomic
policies, no ing ha he educ ion o po en ial gains is due o he lack o coo dina ion,
pa icula ly in e ms o inc easing in a- egional ade (Malamud, 2013). The ma ke
de e minan s include, among o he s, he need o achie e signi ican le els o complemen a i y
be ween economies in o de o inc ease he sha e o in a- egional ade and achie e g ea e
bene i s in e ms o wel a e (Bu o ina and Bo ko, 2022). Hosny (2013) men ions ha mos DCs
conside in eg a ion as an ins umen o inc ease hei compe i i eness in he global economy
and hus place an inc easing numbe o p oduc s in in e na ional ma ke s.
S a ing in he 1950s, speci ically in La in Ame ica, he s uc u alis economic pe spec i e
de eloped by ECLAC b ough oge he some o he a o emen ioned heo e ical elemen s,
a ibu ing a s a egic ole o egional in eg a ion in di e si ying expo s owa ds
manu ac u ed p oduc s, hus s eng hening indus ializa ion and expanding he capaci y
o impo (CEPAL, 1959). Regional in eg a ion is con ingen on he indus ializa ion p ocess
and, in pa icula , on he need o mo e owa ds he manu ac u e o p oduc s wi h a highe
alue added, based on he concep s o specializa ion, indus ial ecip oci y and s uc u al
complemen a i y (CEPAL, 2014). These objec i es migh be a ainable when he pa icipa ing
coun ies gain access o a much la ge ma ke , which a he le el o he na ional p oduc i e
s uc u e may in ol e he ealiza ion o economies o scale and hus p omo ing echnological
de elopmen (V
azquez-L
opez, 2011).
The ise o global alue chains (GVCs) and he cu en ele ance o geog aphical
p oximi y o he o ganiza ion and ope a ion o agmen ed manu ac u ing p ocesses
be ween coun ies ha e e alued egional space as a pla o m o he cons uc ion o
p oduc i e complemen a i ies and showed he need o eadap he in eg a ionis heo y and
i s quan i a i e ins umen s o analysis. In e ms o po en iali ies, his new con ex means
ha , in addi ion o he bene i s adi ionally associa ed wi h egional in eg a ion (access o
la ge ma ke s, lea ning ad an ages, gene a ion o economies o scale, e c.), inc eased
manu ac u ing p oduc i i y and compe i i eness can be added as a esul o supply chain
o ma ion and egional p oduc i e a icula ion (Milbe g e al., 2014). As Ama and
To chinsky (2019) poin ou , inc easing he p opo ion o egional con en in expo s makes i
possible o s eng hen he p oduc i e “spillo e s”gene a ed by o eign sales.
Al hough inal goods a e sold on a wo ldwide scale, he majo i y o he p oduc i e
ac i i ies, pa icula ly in he manu ac u ing co e, a e commonly dis ibu ed among coun ies
in he same egion (Johnson and Nogue a, 2012). The egional bias, acco ding o
Es e adeo dal e al. (2013), s ems om he high cos s o anspo a ion and logis ics when
a eling o long dis ances, including he exis ence o p e e en ial ade ag eemen s be ween
neighbo ing coun ies. The need o a as and secu e supply o pa s and componen s is ye
La in
Ame ican
p oduc i e
in eg a ion
231
ano he aspec ha ecen ly ea i med he po en ial o egional in eg a ion and, as a esul ,
he nea sho ing o a whole se ies o p oduc i e ac i i ies o loca ions close o he main
ma ke s (Pia anesi and A auzo-Ca od, 2019). In he con ex o he cu en de elopmen o
GVCs, he bene i s o egional economic in eg a ion a e no only an inc ease in he sha e o
in a- egional expo s in he o al expo s, bu also and a e y impo an asse is a g ea e
accumula ion o he egional alue included in he ade be ween pa ne s, synonymous wi h
he ealiza ion o ac i i ies wi h highe deg ees o sophis ica ion and highe demand o high-
skilled wo ke s (Ama and To chinsky, 2019).
Recen s udies o he issues aised by economic in eg a ion in La in Ame ica poin o a
sca ce de elopmen o RVCs and a limi ed and shallow inse ion o coun ies in o ex a-
egional GVCs (Blyde and T ach enbe g, 2020;Banco Mundial, 2019;Zaclice e , 2017).
Among he de e minan s o hese de iciencies, some au ho s highligh he e ogeneous and
con lic ing ules o o igin in he di e en exis ing ea ies in he egion (Rome o, 2021;BID,
2017;Cades in e al., 2016). Cades in e al. (2016), o example, es ima e ha di e ences in ules
o o igin be ween exis ing ag eemen s educe he posi i e e ec s o egional ade exchanges
by 15%, and a e especially discou aging in he case o in e media e goods expo s, whe e he
posi i e e ec s a e educed by 30%.
Fo mos coun ies, in a- egional compe i i eness in in e media e goods is concen a ed in
p ima y sec o s and indus ies wi h low echnological con en , while compa a i e ad an ages
a e limi ed o he egional le el in indus ies wi h highe echnological con en , highligh ing he
po en iali ies in e ms o he cons uc ion o p oduc ion linkages in La in Ame ica
(K eime man, 2020;Ama and To chinsky, 2019;Zaclice e , 2017). A pa icula ly p ominen
aspec in he li e a u e is he g owing pa icipa ion o China bo h as a p o ide o in e media e
inpu s in echnology-in ensi e indus ies, and as an impo e o commodi ies om he egion,
wi h eg essi e e ec s on he p oduc i e s uc u e o La in Ame ican coun ies in e ms o hei
deg ees o di e si ica ion and sophis ica ion (Bo o, 2019;CEPAL, 2018;Chun and Guo, 2017).
Wi h an abundance o li e a u e as backg ound, he hypo heses pu o wa d in his pape a e
wo old: Regional p oduc i e in eg a ion in La in Ame ica has no p og essed in e ms o he
egional alue added inco po a ed in i s expo s, and he ajec o ies o p oduc i e and ade
in eg a ion o he selec ed coun ies o he egion ha e mo ed backwa ds in o a mo e adi ional
ade based on he exchange o na u al esou ce-in ensi e inpu s wi h low alue added.
3. Me hod
3.1 Resea ch design/model
In La in Ame ica, in a- egional expo s ha e ollowed he g ow h pa e n o o al expo s,
a e aging a solid g ow h a e o 8% pe yea be ween 1995 and 2015. Howe e , wi h simila
economic s uc u es in he coun ies, ade ied o GVCs expanded by only 0.1% o e ha ime,
compa ed o 19% globally (Banco Mundial, 2019). The absence o a mo e complex ade in he
egion occu s in a con ex in which alue chains s uc u ed by he indus ial and/o se ice
manu ac u ing sec o s a e p ima ily di ec ed o des ina ions in he egion, as a e hose connec ed
o he p ima y sec o and na u al esou ce manu ac u ing. In ac , exclusi ely egional chains
occu mo e equen ly in highly echnological indus ies such as he au omo i e indus y and he
manu ac u e o elec ical machine y o elec onics (Ama and To chinsky, 2019).
Using he WWZ me hodological amewo k (2018) as a s a ing poin , a eg ouping o
he componen s desc ibed is p oposed in his a icle, in o de o dis inguish he sha e o
alue added (domes ic, egional o ex a- egional) as well as he use gi en o hese expo s
( inal o in e media e) o in a- egional expo s o La in Ame ican coun ies o which
in o ma ion is a ailable. The WWZ me hodological amewo k o he analysis o ade
lows a he bila e al le el, based on he use o global inpu -ou pu ma ices, allows
b eaking down he alue o g oss expo s o each sec o -coun y, depending on he o igin o
JEFAS
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he alue added con ained in expo s, as well as hei use. The ollowing se en componen s
a e ob ained:
Componen 1: Domes ic alue added, gene a ed by expo ing coun y (s), inco po a ed in
i s expo s o inal goods o he egion ( ) 5DVAs
FIN.
Componen 2: Domes ic alue added inco po a ed in expo s o in e media e goods ha
will be used by he es o he egion’s coun ies, ei he o he p oduc ion o inal goods o
in e media e goods o e-expo 5DVAs
INTER.
Componen 3: Fo eign alue added o egional o igin, which is inco po a ed in he expo s
o inal goods om s o he egion 5FVA
FIN.
Componen 4: Value added gene a ed in he egion, bu con ained in he in e media e
goods ha a e expo ed om he expo ing coun y o he egion 5FVA
INTER.
Componen 5: Fo eign alue added gene a ed in hi d coun ies, ou side he egion,
inco po a ed in expo s o inal goods om he expo ing coun y o he egion 5FVA
FIN.
Componen 6: Ex a- egional o eign alue added, inco po a ed in he expo s o
in e media e goods om he expo ing coun y o he egion 5FVA
INTER.
Componen 7: Double coun ing o domes ic and o eign o igins ha , when elimina ed,
acili a es a be e assessmen o he ade lows analyzed.
Using hese componen s, he egional alue added (RVA) inco po a ed in a coun y’s expo s
can be calcula ed as he sum o he domes ic alue added (DVA) and he o eign alue added
om he egion (FVA
). Namely:
RVA ¼DVA þFVA
Consequen ly, i is possible o dis inguish he egional alue added inco po a ed in he
expo s o inal goods om ha con ained in he expo s o in e media e goods.
3.2 Da a/ a iables
The sou ce o he da a is he OECD’s Global Inpu -Ou pu Ma ices (ICIO) (OECD, 2021),
which co e s he yea s 1995–2015. Howe e , he p ojec has published wo edi ions o ables
(2016 and 2018) co e ing o e lapping ime pe iods (1995–2011 and 2005–2015), wi h some
changes in he numbe o sec o s (34 in he 2016 edi ion and 36 in he 2018 edi ion) and hei
con en . The e o e, i was decided o di ide he sec o s in o h ee b oad g oups (ex ac i e,
indus y and se ice) and, s a ing in 2005, use he alues p o ided by he second upda ed
se ies (2018 edi ion). Due o he a ailabili y o in o ma ion, he compu a ions we e ca ied ou
o A gen ina, B azil, Chile, Colombia, Mexico and Pe u, which oge he accoun ed o 79.6%
o La in Ame ican expo s in 2015 [1]. Consequen ly, he g oup o egional ading pa ne s ( )
was, in each case, made up o he emaining 5 coun ies in he sample.
3.3 Analy ical p ocedu e
Below, he g oss expo s o a coun y (s) o he g oup o egional pa ne s examined ( ), whe e
( ) is he g oup o hi d coun ies, is decomposed in o he se en essen ial componen s using
ma ix calcula ion:
Xs ¼ðVsBssÞT#Ys
|fflfflfflfflfflfflfflfflfflffl{zfflfflfflfflfflfflfflfflfflffl}
ð1Þ
þ
La in
Ame ican
p oduc i e
in eg a ion
233
ðVsLssÞT# As B sYss þAs B X
G
Y þAs X
G
≠s;
B X
G
u
Y u!
|fflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl{zfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl}
ð2Þ
þ
ðV B sÞT#Ys
|fflfflfflfflfflfflfflfflfflfflffl{zfflfflfflfflfflfflfflfflfflfflffl}
ð3Þ
þðV B sÞT#ðAs L Y Þ
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þ
X
G
≠s;
V B s!T
#Ys
|fflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl{zfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl}
ð5Þ
þ X
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≠s;
V B s!T
#ðAs L Y Þ
|fflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl{zfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl}
ð6Þ
þ
2
4ðVsLssÞT# As B s X
G
≠s
Ys !þðVsBss VsLssÞT#As P þ X
G
≠s
V B s!T
#ðAs L X Þ3
5
|fflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl{zfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflfflffl}
ð7Þ
Whe e Vsis he ec o o sec o al coe icien s o alue added pe uni o ou pu ha o igina e in
coun y s ( alue added ha o igina es in he egion (V Þo inco po a ed om hi d coun ies
(V Þis ecognized in a simila way). Bss,B
s yB
s a e subma ices o he Leon ie global in e se,
which ep esen he inpu equi emen s o coun y s, depending on hei o igin (s, o ). Lss is
he local Leon ie in e se, o he inpu equi emen s ob ained solely om domes ic ac o s pe
uni o inal demand. Th oughou he equa ion, by mul iplying he alue added coe icien s
(Vs
;V
;V Þby Leon ie subma ices (Bss,B
s,B
s
;LssÞ he alue added mul iplie s a e ob ained.
By mul iplying hese coe icien s by expo s om s o (X
s
), dis inguishing be ween hose
p oduced in he o m o inal goods (Ys ) and hose p oduced in he o m o in e media e goods
(As P Þ, he se en componen s a e ob ained. A
s
is he ma ix o in e media e inpu s expo ed
om s o pe uni o ou pu o coun y , and P is he ec o o g oss ou pu o .
4. Resul s
4.1 Desc ip i e analysis
An ini ial look a he e olu ion o ade in eg a ion in La in Ame ica, bo h in e ms o he
weigh o in a- egional ade in o al expo s o he coun ies s udied and—in a quali a i e
manne —conside ing he na u e o in a- egional expo s, e eals wo dis inc ends.
In e ms o he i s end, despi e he signi ican inc ease in global ade be ween 1995 and
2015, he weigh o in a- egional expo s in o al expo s has emained ela i ely cons an as
a esul o he es ablishmen o economic openness policies unde “open” ade in eg a ion
schemes beginning in he 1990s. In ac , he sligh inc eases in in a- egional expo s (X
s
)asa
pe cen age o o al expo s (X
) in B azil, Chile, Colombia, Mexico and Pe u we e mo e han
o se by A gen ina’s d op om 30.6% in 1995 o 22.2% in 2015. (See Table 1).
Signi ican ly, he educ ion in A gen ine in a- egional ade seems o be due o a
eo ien a ion o aw ma e ial expo s owa ds China as a esul o China’s eme gence as he
egion’s leading buye o p ima y commodi ies, which esul ed in a shi in La in Ame ican
coun ies’p oduc i e s uc u es in a o o a de elopmen model based on s a ic compe i i e
ad an ages (Bo o, 2019). In ac , La in Ame ican expo s o i s h ee main ex a- egional
ma ke s (USA, China and he EU) inc eased hei concen a ion o p oduc s, e lec ing a
ma ked end owa ds a ep ima iza ion induced by high aw ma e ial p ices (see Figu e 1). In
he case o A gen ina, he weigh o he X
s
in o al expo s o ex ac i e p oduc s declined
JEFAS
29,58
234
om 33.1% in 1995 o 12.1% in 2015, esul ing in a educ ion in his pe cen age om 23.9% o
14.4% in he se ice ca ego y o e he same pe iod.
S a ing in 2012, he beginning o a new nega i e phase in commodi y p ices, he
s agna ion o wo o he la ges economies in he egion (A gen ina and B azil) and he
slowdown in global demand as a esul o he 2008–2009 c isis se e ely a ec ed ade lows,
especially in a- egional exchanges (Ama and To chinsky, 2019). In he case o Sou h
Ame ican coun ies, he g owing impo ance o expo ing na u al esou ces and de i a i es
as inpu s o ex a- egional des ina ions has limi ed he deg ees and ypes o pa icipa ion in
mode n indus ial p ocesses agmen ed in o alue chains (Blyde, 2014). Va ious au ho s
poin o he main economies o La in Ame ica (B azil, Mexico and A gen ina) ha ing a g ea e
p oduc i e linkage wi h coun ies ou side he egion, a low coe icien o cohesion and a
limi ed deg ee o in e connec ion wi h o he egional pa ne s as key explana o y elemen s
o RVC’s limi ed de elopmen (L
amba y, 2016;Beke man and Rikap, 2010).
In suppo o he o egoing, and as he second no ewo hy end o his i s desc ip i e
analysis, heweigh o in e media e goods in heX
s
o he sampled coun ies was educed, going
1995 2015
In a-
egional
expo s
(X
s
)
X
s
/
X
Expo s o
in e media e goods in
X
s
In a-
egional
expo s
(X
s
)
X
s
/
X
Expo s o
in e media e goods in
X
s
A gen ina 7,606 30.6 52.4 13,822 22.2 48.4
B azil 5,849 10.6 55.2 25,477 12.2 53.7
Chile 2,501 12.4 68.6 8,948 13.3 62.5
Colombia 903 7.7 65.6 5,086 12.4 61.4
Mexico 3,010 3.5 49.9 12,927 3.5 42.6
Pe u 537 8.4 89.0 4,005 10.8 67.0
To al 20,405 10.0 56.4 70,264 9.0 53.1
No e(s): *In a- egional expo s a e made up o ade be ween he coun ies in he able
Sou ce(s): Own elabo a ion wi h da a om OECD (2021)
No e(s): *Mon hly equency excludes gold
Sou ce(s): Own elabo a ion wi h da a om he In e na ional Mone a y Fund (2021)
70
120
170
220
270
320
370
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Table 1.
In a- egional expo
da a o selec ed
coun ies*, 1995 and
2015 (Millions o
dolla s and
pe cen ages)
Figu e 1.
E olu ion o
commodi y p ices,
1995–2015* (Index
base 100 in 2000)
La in
Ame ican
p oduc i e
in eg a ion
235
om 56.4% in 1995 o 53.1% in 2015 (see Table 1). When compa ing 1995 o 2015, he indica o
shows a dec ease in all si ua ions, demons a ing a shi owa ds classic Rica dian- ype ade a
he expense o mo e complex in a-indus y exchanges associa ed wi h he es ablishmen o
indus ial RVCs. As he GVC app oach shows, “open”in eg a ion based on commodi y expo s
limi s he possibili ies o upg ading [2] in he di ec ion o ca ying ou indus ial asks o se ices
wi h g ea e in ensi y in alue added. This is pa ly because since aw ma e ial ma ke s a e
domina ed by pu chasing coun ies, he supplying coun ies compe e on p ice, blocking
p ocesses o lea ning and building o echnological capabili ies in hese loca ions.
4.2 T ajec o ies o ade and p oduc i e in eg a ion
In o de o co obo a e and illus a e an e olu ion o he egion’s p ocess o p oduc i e
in eg a ion in he di ec ion o a shallowe end, ajec o ies o ade and p oduc i e
in eg a ion we e de eloped o each coun y in he sample om 1995 o 2015 (see Figu e 2).
These ajec o ies a e depic ed in a g aph wi h wo dimensions o analysis. The i s one
ep esen s he e olu ion o ade ela ions be ween he sampled coun ies in g oss e ms,
based on he sha e o in a- egional expo s (X
s
) in o al expo s (X
). Using he esul s o he
applied inpu -ou pu me hodology and he weigh o he RVA in he X
s
, he second
dimension assesses he in ensi y o hese ela ions in e ms o alue added. In hese g aphs, a
coun y’s deg ee o ade in eg a ion g ows as i a els o he igh in ime, whe eas an
upwa d end sugges s a la ge deg ee o p oduc i e in eg a ion.
The g aphs o each o he coun ies s udied e eal ha he ajec o ies’s a ing poin s in
1995 a e posi ioned abo e he poin s belonging o 2015. This means ha he RVA included in
in a- egional expo s dec eased om 1995 o 2015, indica ing a lowe deg ee o p oduc i e
in eg a ion be ween La in Ame ican economies o e he s udy pe iod. The si ua ions o
B azil and Mexico, he egion’s la ges indus ialized economies, a e pa icula ly no ewo hy.
Due o he ising in eg a ion o hese coun ies in o ex a- egional GVCs, he weigh o he
RVA in he X
s
was educed by 6 and 12%, espec i ely. This phenomenon can be explained
by hese na ions’limi ed use o he egional ma ke o es ablish economies o scale and
lea ning p ocesses in o de o g ow hei expo s o coun ies ou side he bloc, which has
p e en ed he consolida ion o ecip ocal egional ade.
Fo example, as Beke man and Rikap (2010) poin ou , in he bila e al ela ionship be ween
B azil and A gen ina, he la ge economy con inues o supply goods o he smalle one, while he
la e ’s expo s a e losing g ound in hei pa ne ’s ma ke . As o Mexico, despi e he ac ha he
X
s
po ion o X
inc eased since he i s decade o his cen u y, he weigh o RVA in X
s
emained
s eady a oughly 68%, he lowes o he sample, indica ing a pa e n o egional exchange g ow h,
wi hou an inc ease in p oduc i e in eg a ion. In Colombia, he weigh o he X
s
in he X
inc eased
om 7.7% in 1995 o 12.4% in 2015, coinciding wi h a signi ican inc ease wi hin he indus ial
sec o s in he s uc u e o sales o he egion, om 51.5% o 66.9% in he same yea s. Howe e , he
RVA’s sha e o indus ial in a- egional expo s declined since 2000, om 87% in 2000 o 83.7% in
2015, indica ing a sca ce p oduc i e in eg a ion wi h i s egional pa ne s.
Mo eo e , when examining he e olu ion o he RVA included in in e media e indus ial
goods aded wi hin he egion, all coun ies show a declining end as a esul o he
impo e ishmen o he asks ca ied ou wi h ega d o hese expo s in e ms o hei
sophis ica ion g ades (see Figu e 3). In Colombia, his decline, om 86.1% in 2010 o 77.5% in
2015, la gely explains he obse ed educ ion in RVA in he X
s
, despi e ises eco ded in he
weigh s o bo h he X
s
in he X
, as well as in indus ial expo s in sales o he egion. In
gene al, an in olu iona y end in e ms o p oduc i e in eg a ion is con i med in all cases,
bu wi h wo a ian s: coun ies ha eco ded an inc ease in he ela i e weigh o hei X
s
(B azil, Chile, Colombia, Pe u and Mexico) and A gen ina, which expe ienced a educ ion in
he p opo ion o i s X
s
wi hin i s X
as a esul o he a o emen ioned ep ima iza ion and
eo ien a ion o i s expo s o China.
JEFAS
29,58
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Abou he au ho
Ra
ul V
azquez-L
opez (PhD) is a ull- ime senio esea che a he Ins i u e o Economic Resea ch o he
UNAM (Na ional Au onomous Uni e si y o Mexico) and a membe o he Na ional Sys em o
Resea che s o CONACYT, he Mexican Na ional Council o Science and Technology. Since 2012, his
con ibu ions o economic esea ch ha e ea ned him se en awa ds in di e en ields (social sciences,
economic esea ch, o eign ade, egional economic analysis and ag icul u al economics) om
p es igious na ional and in e na ional ins i u ions (San F ancisco S a e Uni e si y, IONA College in New
Yo k, UAM, Tianjin Uni e si y in China, Bancomex (Mexican Fo eign T ade Bank), UANL, IIEc-
UNAM, UDEG). Ra
ul V
azquez-L
opez can be con ac ed a : [email p o ec ed]
Fo ins uc ions on how o o de ep in s o his a icle, please isi ou websi e:
www.eme aldg ouppublishing.com/licensing/ ep in s.h m
O con ac us o u he de ails: [email p o ec ed]
La in
Ame ican
p oduc i e
in eg a ion
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