Trade in Intangibles and a Global Value Chain-based View of International Trade and Global Imbalance

This event is part of the Department of Strategy and International Business Research Seminar series.

Speaker: Professor Xiaolan Fu, University of Oxford

Synopsis

This seminar will develop a framework for the measurement of global trade that integrates trade-in-intangibles and trade-in-goods and services in the context of globalization, and applies it for the analysis of global trade imbalance. Through in-depth discussions of the five modes through which trade-in-tangibles are carried out, it creates an integrated framework from the perspective of global value chains. Applying this framework to the estimation of trade imbalance of the U.S., its overall trade deficit reduces nearly half of its size from USD750 billion to USD396 billion in 2016 with a cautious adjustment without taking into account the income from trade-in-intangibles in most of the U.S. firms accrued through outsourcing and collaboration. It argues that the global trade imbalance and policy responses to solve this should be discussed using a framework that fully incorporates different types of trade activities in the 21st century as its basis. The fragmented global production finely orchestrated by MNEs implies that it is impossible for one single country involved in the GVCs to achieve high value-added per capita and mass employment at the same time. This is a new paradox of globalization. Re-distribution of the often hidden or shifted income from the entities who gained a lot from the trade in intangibles to the rest of the society is crucial to reducing inequalities. Tax avoidance by shifting these benefits abroad should be curbed. The study is being carried out in collaboration with Pervez Ghauri.

About the speaker

Xiaolan Fu is Professor of Technology and International Development in the University of Oxford.  She is the Founding Director of the Technology and Management Centre for Development (TMCD), Professor of Technology and International Development and Fellow of Green Templeton College. She was appointed by the Secretary-General of the United Nations to the Ten-Member High Level Advisory Group of the UN Technology Facilitation Mechanism and to the Governing Council of the UN's Technology Bank for Least Developed Countries. She is also a member of the UN SDSN Leadership Council led by Jeffrey Sachs and a member of the Council for Global Economic Transformation co-chaired by Joseph Stiglitz and Michael Spence.

Professor Fu’s research interests include innovation, technology and industrialisation; trade, foreign direct investment and economic development; emerging Asian economies; innovation and productivity in the UK/US. She has published extensively in leading international journals independently or in collaboration with others. Her recent books include Innovation under the Radar (forthcoming), China's Path to Innovation, China’s Role in Global Economic Recoveryand The Rise of Technological Power in the South. She is Editor-in-Chief of the Journal of Chinese Economic and Business Studies, and serves on the editorial boards of Industrial and Corporate Change, International Journal of Technology Management, and four other international journals.