ABSTRACT
This chapter focuses on six Asian economies–China, Indonesia, India, Japan, the republic of Korea, and Taiwan in the world input–output database (WIOD). It introduces the WIOD data set, as well as the methodology of global input–output analysis that is applied to this data set to estimate the employment effects of global value chains (GVCs). The chapter presents and analyses the estimated employment generated by GVCs in these Asian economies. It uses some of the employment results to address a specific research question: what causes the phenomenon of 'value-added erosion' for some countries? The chapter explores this question by conducting a panel data co-integration econometric analysis. China is a country that experienced value-added erosion and is also a country that experienced a surge of foreign high-skilled labour share embodied in its import content of exports. The increase of the foreign intermediate share over time is compensated for by the decline of the domestic value-added share.
