171
labour in the world is embodied in trade (between seven world regions – the numbers would be higher when considering trade between all countries). Some forms of
damaging labour conditions seem to be supported by trade, e.g. 20 % of all hazardous child labour is for exports. And 38 % of all work done by women became
embodied in international trade. Asia is the largest exporting region of all forms of
(bad) labour, except for child labour and hazardous child labour for which Africa is
the largest exporter (Simas et al. 2014 ).
Wages on the other hand are highest in the developed world, and therefore trade
fl ows of embodied wages take different paths to those for labour. The highest fl ows
of wages embodied in exports are between developed countries, mostly from the
USA to Japan (and backwards), Canada and Europe, but also to China .
The fl ow of money in trade has been studied extensively for a long time, but
recently researchers have used newly available multi-region input-output (MRIO)
models to study specifi c economic aspects of trade, such as fragmentation or value
added (VA) in trade. Trade statistics are normally based on gross export values, thus
double counting the VA along global supply/value chains (Kelly and La Cava 2013 ).
Interest has therefore grown in VA as a ‘trade commodity’ that can become embodied in international trade fl ows, and methodological frameworks have been developed accordingly (e.g. Koopman et al. 2014 ). One study found that the foreign VA
content of exports from Luxembourg was 61 % in 2011 (Foster-McGregor and
Stehrer 2013 ). Interestingly, there seems to be a trend towards value being added by
capital and high-skilled labour and away from less-skilled labour (Timmer et al.
2014 ). The capital share in the VA of emerging economies is rising, whilst the share
of low-skilled labour in their VA is declining.
Meng et al. ( 2015 ) synchronously evaluate VA and CO 2 emissions in global
trade. Their detailed analysis confi rms the increasing fragmentation of international
trade. They fi nd that more than half (ca. 60 %) of China ’s emissions attributable to
foreign fi nal demand are embodied in the trade of intermediate goods (ca. 40 % of
export emissions are embodied in the trade of fi nal goods). Whether a country’s
emissions become embodied in the trade of fi nal or intermediate goods depends on
its position in the global value chain. Meng et al. ( 2015 ) demonstrate how CO 2
emissions from Poland’s metal industry are associated with fi nal demand in the
USA: 90 % of these emissions are embodied in intermediate good trade (roughly
half of which are traded directly between Poland and the USA, and the other half is
traded by way of third countries).
2.2.2 Trends of Impacts Embodied in Trade
The results in Table 8.1 show clearly that trade is associated with a signifi cant dislocation of environmental, social and economic factors, thus further separating
impacts of production (both negative and positive) in one place from consumption
elsewhere. Forty per cent of the national carbon footprint of the UK is exerted
abroad (Hertwich and Peters 2009 ) and 75 % of its national water footprint (Hoekstra
and Mekonnen 2012 ). The numbers presented in Table 8.1 are the latest available,
8 Impacts Embodied in Global Trade Flows
labour in the world is embodied in trade (between seven world regions – the numbers would be higher when considering trade between all countries). Some forms of
damaging labour conditions seem to be supported by trade, e.g. 20 % of all hazardous child labour is for exports. And 38 % of all work done by women became
embodied in international trade. Asia is the largest exporting region of all forms of
(bad) labour, except for child labour and hazardous child labour for which Africa is
the largest exporter (Simas et al. 2014 ).
Wages on the other hand are highest in the developed world, and therefore trade
fl ows of embodied wages take different paths to those for labour. The highest fl ows
of wages embodied in exports are between developed countries, mostly from the
USA to Japan (and backwards), Canada and Europe, but also to China .
The fl ow of money in trade has been studied extensively for a long time, but
recently researchers have used newly available multi-region input-output (MRIO)
models to study specifi c economic aspects of trade, such as fragmentation or value
added (VA) in trade. Trade statistics are normally based on gross export values, thus
double counting the VA along global supply/value chains (Kelly and La Cava 2013 ).
Interest has therefore grown in VA as a ‘trade commodity’ that can become embodied in international trade fl ows, and methodological frameworks have been developed accordingly (e.g. Koopman et al. 2014 ). One study found that the foreign VA
content of exports from Luxembourg was 61 % in 2011 (Foster-McGregor and
Stehrer 2013 ). Interestingly, there seems to be a trend towards value being added by
capital and high-skilled labour and away from less-skilled labour (Timmer et al.
2014 ). The capital share in the VA of emerging economies is rising, whilst the share
of low-skilled labour in their VA is declining.
Meng et al. ( 2015 ) synchronously evaluate VA and CO 2 emissions in global
trade. Their detailed analysis confi rms the increasing fragmentation of international
trade. They fi nd that more than half (ca. 60 %) of China ’s emissions attributable to
foreign fi nal demand are embodied in the trade of intermediate goods (ca. 40 % of
export emissions are embodied in the trade of fi nal goods). Whether a country’s
emissions become embodied in the trade of fi nal or intermediate goods depends on
its position in the global value chain. Meng et al. ( 2015 ) demonstrate how CO 2
emissions from Poland’s metal industry are associated with fi nal demand in the
USA: 90 % of these emissions are embodied in intermediate good trade (roughly
half of which are traded directly between Poland and the USA, and the other half is
traded by way of third countries).
2.2.2 Trends of Impacts Embodied in Trade
The results in Table 8.1 show clearly that trade is associated with a signifi cant dislocation of environmental, social and economic factors, thus further separating
impacts of production (both negative and positive) in one place from consumption
elsewhere. Forty per cent of the national carbon footprint of the UK is exerted
abroad (Hertwich and Peters 2009 ) and 75 % of its national water footprint (Hoekstra
and Mekonnen 2012 ). The numbers presented in Table 8.1 are the latest available,
8 Impacts Embodied in Global Trade Flows