Can anyone provide any reliable indication of the percentage of global trade conducted within and among corporations (intra and inter-firm trade)? Any anecdotal studies perhaps that account for these forms of trade? And last but not least, if intra and inter-firm trade are so significant (dominant?), why statistics are not collected worldwide?! Is it due to corporate abuse to hide their transfer pricing practices, or what?
Hi George,
UNCTAD has dealt with these issues in several of their annual World Investment Reports (WIR), with estimates of about 1/3 of world trade being intra-firm and possibly as much as 80% of world trade being within Global Value Chains (both intra-firm and inter-firm trade). The 2013 edition of WIR provides a detailed analysis. For a short intro, here is a link to the press release: http://unctad.org/en/pages/PressRelease.aspx?OriginalVersionID=113.
Best,
Gabriel
Normally the problem is as you have suggested non-cooperation of firms to provide data. Though some specific countries might have this data. The trade data is normally captured at borders or ports. Most of the data is at country level given present production structure such data is flawed as value addition happens in a number of countries due to MNC networks. You can look at TIVA database of OECD which somewhat takes care of these problems.
Another challenge revolves around trade in services. These are intangible and cannot easily be tracked - a service can be delivered in one place (by a consultant, for instance) and accounted for in another. The whole problem of taxing services such as Amazon and Google revolves around the question of where the service is produced (if indeed this can be ascertained) and where it is delivered. This a grey area for two reasons. 1) where, exactly, is the service work being performed? 2) how are services valued, especially if they are delivered within a multinational corporation?
So, even if data are obtained, what they are measuring and how they should be interpreted is another matter.
please see attached articles
http://personal.lse.ac.uk/rappopor/papers/Intrafirm_Trade.pdf
http://www.ase.tufts.edu/gdae/education_materials/modules/Corporate_Power_in_a_Global_Economy.pdf
Thanks Nino, for the links. But, could you also perhaps explain to me what is your view on my question, please? Specifically, are intra / inter-firm trade dominant? As opposed to traditionally understood inter-national trade? That is trade between nations / countries....
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