Decomposing global sectoral sales growth: a GVC perspective

We propose an exact decomposition of sectoral annual sales growth in 1995-2020 through the lens of global input-output analysis across 26 sectors and 189 countries. We document that, apart from the growth of demand, changes in Leontief-inverse coefficients were a key driver for total sales growth, much more so than the geography of final goods and services trade. And we find that labour-market, property-rights or tax policies impact all the components of sales growth.