Investigation of Global Production Network via Network Analysis

Abstract

Network analysis, used to analyze complex systems from neurology to social networks and transportation, has become also a popular tool to analyze complex network structures in economics. Most popular fields of economics in which network tools are used are international trade and finance. However, the global input–output network has also become a new field that is analyzed via network tools, recently. The advantage of network analysis is to provide some high-degree indicators compared to standard tools give first-degree indicators. Because the data used in network analysis include all bilateral connections between nodes and the resulting statistics reflect the feature of the whole system. That is why results obtained from network analysis are more informative than the results of standard analyze tools. In this study, we aim to analyze global input–output tables via network tools. In today’s globalized world, each part of a final product is produced in different countries rather than being produced in a single country from beginning to end. As a result of these flows, global value chains have started to be called global production network. Thus, it is so important to reveal inter-sectorial connections to foresee the impact of a probable demand-shock or a supply-shock. In this context, we aim to analyze global input–output network by using WIOD data for the selected years. Thus, we analyze the evolution of network structure and centrality of global sectors during the period.

Appendices

Appendix 1: Top ten Hub-Central and Authoritative-Central Sectors of Global Production Network

	2000		2005		2008		2009		2010		2014
USA_ELEC	0.68	USA_CHMICA	0.321	CAN_MINING	0.837	CAN_MINING	0.697	CAN_MINING	0.623	CAN_MINING	0.905
JPN_ELEC	0.38	JPN_ELEC	0.290	MEX_MINING	0.292	MEX_MINING	0.299	MEX_MINING	0.297	MEX_MINING	0.241
USA_TRANS	0.22	NOR_MINING	0.269	CAN_CHMICA	0.189	DEU_CHMICA	0.217	AUS_MINING	0.247	CHN_CHMICA	0.149
KOR_ELEC	0.21	TWN_ELEC	0.258	DEU_CHMICA	0.160	CAN_CHMICA	0.194	DEU_CHMICA	0.212	CAN_CHMICA	0.140
USA_CHMICA	0.18	DEU_CHMICA	0.255	CHN_CHMICA	0.136	GBR_CHMICA	0.166	JPN_CHMICA	0.194	DEU_CHMICA	0.119
CAN_MINING	0.16	USA_ELEC	0.251	GBR_CHMICA	0.115	JPN_CHMICA	0.160	CAN_CHMICA	0.186	JPN_CHMICA	0.108
TWN_ELEC	0.16	KOR_ELEC	0.232	JPN_CHMICA	0.103	CHN_CHMICA	0.149	CHN_CHMICA	0.182	KOR_CHMICA	0.078
CAN_CHMICA	0.13	NLD_CHMICA	0.218	NOR_MINING	0.100	RUS_MINING	0.149	RUS_MINING	0.179	CHN_ELEC	0.068
DEU_CHMICA	0.11	USA_TRANS	0.193	RUS_MINING	0.097	USA_CHMICA	0.133	USA_CHMICA	0.169	CAN_METAL	0.065
JPN_CHMICA	0.11	RUS_MINING	0.189	FRA_CHMICA	0.097	IRL_CHMICA	0.132	KOR_CHMICA	0.159	MEX_CHMICA	0.058
Authority centralities
	2000		2005		2008		2009		2010		2014
MEX_ELEC	0.52	CHN_ELEC	0.359	USA_CHMICA	0.913	USA_CHMICA	0.808	USA_CHMICA	0.749	USA_CHMICA	0.960
TWN_ELEC	0.31	DEU_CHMICA	0.321	USA_SERV	0.183	USA_SERV	0.273	CHN_CHMICA	0.281	USA_SERV	0.140
KOR_ELEC	0.26	USA_SERV	0.256	USA_PUBLIC	0.165	DEU_CHMICA	0.187	USA_SERV	0.242	USA_MINING	0.102
USA_ELEC	0.23	FRA_CHMICA	0.224	DEU_CHMICA	0.136	CHN_CHMICA	0.172	DEU_CHMICA	0.185	CHN_CHMICA	0.082
USA_CHMICA	0.22	MEX_ELEC	0.204	USA_MINING	0.110	CHN_ELEC	0.127	JPN_CHMICA	0.173	USA_PUBLIC	0.076
USA_SERV	0.21	GBR_SERV	0.186	JPN_CHMICA	0.081	USA_PUBLIC	0.119	CHN_ELEC	0.152	USA_METAL	0.060
JPN_ELEC	0.20	GBR_CHMICA	0.164	CHN_CHMICA	0.080	JPN_CHMICA	0.114	KOR_CHMICA	0.122	CHN_ELEC	0.051
GBR_SERV	0.18	CAN_SERV	0.161	FRA_CHMICA	0.079	NLD_CHMICA	0.098	NLD_CHMICA	0.117	DEU_CHMICA	0.049
CAN_ELEC	0.17	TWN_ELEC	0.159	USA_METAL	0.064	FRA_CHMICA	0.097	TWN_CHMICA	0.113	KOR_CHMICA	0.046
MEX_TRANS	0.17	NLD_CHMICA	0.156	NLD_CHMICA	0.061	ITA_CHMICA	0.095	CHN_METAL	0.100	USA_CONSTR	0.045

Appendix 2: Comparison of the Hub and Authority Centrality Measures of Selected Sectors (2005–2010)

Sectors	2005				2010
	Countries	Hub	Countries	Auth	Countries	Hub	Countries	Auth
Machinery	USA	0.054	DEU	0.045	DEU	0.030	CHN	0.029
	DEU	0.053	CHN	0.045	CHN	0.022	USA	0.022
	JPN	0.030	USA	0.044	JPN	0.018	DEU	0.020
	ITA	0.028	JPN	0.018	USA	0.016	KOR	0.009
	CAN	0.022	CAN	0.016	MEX	0.015	ITA	0.008
Transports equipment	USA	0.193	USA	0.153	USA	0.030	USA	0.053
	JPN	0.086	CAN	0.141	JPN	0.030	DEU	0.032
	MEX	0.086	MEX	0.094	DEU	0.030	CHN	0.029
	CAN	0.080	DEU	0.088	MEX	0.028	MEX	0.022
	GBR	0.067	FRA	0.071	CAN	0.022	FRA	0.022
Professional, scientific and technical activities	USA	0.048	CHN	0.050	GBR	0.025	USA	0.026
	GBR	0.044	USA	0.031	DEU	0.022	CHN	0.017
	DEU	0.031	FRA	0.020	USA	0.022	FRA	0.009
	NLD	0.022	GBR	0.011	CHN	0.020	DEU	0.007
	CHN	0.021	CAN	0.011	CAN	0.015	ITA	0.005
Services	USA	0.136	USA	0.256	RUS	0.062	USA	0.242
	GBR	0.061	GBR	0.186	USA	0.053	GBR	0.084
	ESP	0.059	CAN	0.161	CAN	0.034	DEU	0.057
	CAN	0.054	DEU	0.126	FRA	0.029	CAN	0.054
	NLD	0.043	FRA	0.088	NLD	0.029	JPN	0.047
Textile	ITA	0.015	CHN	0.020	CHN	0.010	CHN	0.017
	USA	0.011	TUR	0.013	ITA	0.005	TUR	0.008
	CHN	0.011	USA	0.013	KOR	0.005	USA	0.006
	KOR	0.007	MEX	0.010	DEU	0.003	KOR	0.005
	DEU	0.007	FRA	0.009	TWN	0.003	ITA	0.005
Finance	CHE	0.031	USA	0.015	CHE	0.015	USA	0.008
	GBR	0.026	GBR	0.014	GBR	0.012	LUX	0.006
	USA	0.020	LUX	0.013	IRL	0.011	GBR	0.005
	LUX	0.018	CAN	0.007	LUX	0.007	DEU	0.003
	IRL	0.017	DEU	0.006	DEU	0.006	CAN	0.002

Appendix 3: World Input–Output Table Structure

			Use by country-industries								Final use by countries			Total use
			Country 1			…	Country M				Country 1	…	Country M
			Industry 1	…	Industry N	…	Industry 1	…		Industry N		…
Supply from country- industries	Country 1	Industry 1
		…
		Industry N
	….
	Country M	Industry 1
		…
		Industry N
Value added by labour and capital
Cross output

Appendix 4: Sectorial Aggregation

Code	Description
A01	Crop and animal production, hunting and related service activities	Agriculture and farming
A02	Forestry and logging
A03	Fishing and aquaculture
B	Mining and quarrying	Mining
C10-C12	Manufacture of food products, beverages and tobacco products	Food
C13-C15	Manufacture of textiles, wearing apparel and leather products	Textile
C16	Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials	Paper
C17	Manufacture of paper and paper products
C18	Printing and reproduction of recorded media	Other manufacture
C19	Manufacture of coke and refined petroleum products	Chemical
C20	Manufacture of chemicals and chemical products
C21	Manufacture of basic pharmaceutical products and pharmaceutical preparations
C22	Manufacture of rubber and plastic products
C23	Manufacture of other non-metallic mineral products
C24	Manufacture of basic metals	Metal
C25	Manufacture of fabricated metal products, except machinery and equipment
C26	Manufacture of computer, electronic and optical products	Electrical equipment
C27	Manufacture of electrical equipment
C28	Manufacture of machinery and equipment n.e.c.	Machinery
C29	Manufacture of motor vehicles, trailers and semi-trailers	Transport equipment
C30	Manufacture of other transport equipment
C31_C32	Manufacture of furniture; other manufacturing	Other manufacture
C33	Repair and installation of machinery and equipment
D35	Electricity, gas, steam and air conditioning supply	Public utility
E36	Water collection, treatment and supply
E37-E39	Sewerage; waste collection, treatment and disposal activities; materials recovery; remediation activities and other waste management services
F	Construction	Construction
G45	Wholesale and retail trade and repair of motor vehicles and motorcycles	Sales
G46	Wholesale trade, except of motor vehicles and motorcycles
G47	Retail trade, except of motor vehicles and motorcycles
H49	Land transport and transport via pipelines	Services
H50	Water transport
H51	Air transport
H52	Warehousing and support activities for transportation
H53	Postal and courier activities
I	Accommodation and food service activities
J58	Publishing activities	Broadcast & publishing
J59_J60	Motion picture, video and television programme production, sound recording and music publishing activities; programming and broadcasting activities
J61	Telecommunications	Services
J62_J63	Computer programming, consultancy and related activities; information service activities
K64	Financial service activities, except insurance and pension funding	Financial
K65	Insurance, reinsurance and pension funding, except compulsory social security
K66	Activities auxiliary to financial services and insurance activities
L68	Real estate activities	Services
M69_M70	Legal and accounting activities; activities of head offices; management consultancy activities	Professional, scientific and technical activities
M71	Architectural and engineering activities; technical testing and analysis
M72	Scientific research and development
M73	Advertising and market research
M74_M75	Other professional, scientific and technical activities; veterinary activities
N	Administrative and support service activities	Services
O84	Public administration and defense; compulsory social security
P85	Education
Q	Human health and social work activities
R_S	Other service activities
T	Activities of households as employers; undifferentiated goods- and services-producing activities of households for own use	Other manufacture
U	Activities of extraterritorial organizations and bodies	Services