Global Value Chains and U.S. Economic Activity During COVID-19

RePEc Short ID: ple692
ORCID iD: 0000-0002-0072-0441

LaBelle, Jesse; Leibovici, Fernando; Santacreu, Ana Maria

doi:10.20955/r.103.271-88

Journal Article

Global Value Chains and U.S. Economic Activity During COVID-19

Abstract: We investigate the role of global value chains in the declines of manufacturing employment and output in the U.S. during COVID-19. Specifically, we identify the role of global value chains by exploiting heterogeneity across industries in cross-country sourcing patterns and its interaction with exogenous cross-country variation in the containment policies introduced to combat the virus. We find that global value chains played a significant role in the decline of output and employment across U.S. manufactures. Moreover, we find a modest impact of diversifying or renationalizing global value chains in mitigating the economy's exposure to foreign shocks.

JEL Classification: F13; F14; F44;

https://doi.org/10.20955/r.103.271-88