Why Exports Alone Can’t Make Poor Countries Rich

The video discusses the concept of trade flow and value-added in exports, using the example of the iPhone assembled in China. Xiao Jiang, an assistant professor, explains global value chains and the phenomenon of value-added erosion, where domestic value-added is reduced due to increased foreign intermediates. The video highlights the power dynamics in global value chains, with foreign firms often dominating high-value activities. Research findings show a link between high-skill foreign labor and value-added erosion. The video suggests careful engagement in global value chains and recommends industrial upgrading and labor protection as solutions.

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