EU Science Hub

EU Exports to the World: Effects on Income

The European Commission identified trade policy as a core component of the European Union’s 2020 Strategy. The fast changing global economy, characterised by the dynamic creation of business opportunities and increasingly complex production chains, means that it is now even more important to fully understand how trade flows affect income generation. Gathering comprehensive, reliable and comparable information on this is crucial to support evidence-based policymaking. Guided by that objective, the European Commission’s Joint Research Centre (JRC) and the Commission’s Directorate General for Trade have collaborated to produce this publication. It aims to be a valuable tool for trade policymakers. Following up the first edition (Arto et al., 2015), the report features a series of indicators to illustrate in detail the relationship between trade and income (i.e. value added) generation for the EU as a whole and for each EU Member State using the World Input-Output Database (WIOD), 2016 release (Timmer et al., 2015, 2016), as the main data source. This information has been complemented with data on labour compensation by skill from EUKLEMS. All the indicators relate to the EU’s exports to the rest of the world so as to reflect the scope of EU trade policymaking. Most indicators are available as off 2000 but, due to data constraints, the indicator on labour compensation split by skill is only available from 2008 to 2014. The geographical breakdown of the data includes the 28 EU Member States, Australia, Brazil, Canada, China, India, Indonesia, Japan, Mexico, Norway, Russia, South Korea, Switzerland, Turkey, Taiwan, the United States of America, and an aggregate “Rest of the World” region. On the basis of the value added embodied in every million EUR worth of exports in 2014 and more recent data on international trade in goods and services, this report also provides projections elaborated by the JRC for 2017 using a different methodology, so they should be taken with caution. The information presented in this pocketbook is complemented with an electronic version allowing downloads of the tables with the complete time series (2000-2014 and 2017).
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