Victor Fontaine

Bastien Hénaff
Pierre-Alexandre Hovelacque

Global Value Chain

APS exercice 1 Globalization

1. Select a Product Category (Trade/Merchandise) and calculate the

distance from your country of origin(a) (of one member of the group) and
Brazil using the CAGE framework – find the minimum distance country to
Brazil

- The trade is import Meat and edible meat offal.

- The Cage distance between Brazil and France is 12189.

- The minimum cage distance country to Brazil in the export sector of meat
and edible meat offal is the Paraguy. (471)
2. Compare the physical and the CAGE distance – what are the most
relevant dimensions (common official language, colonial linkages, any trade
agreement, distance, share a common border, GDP per capita ratio,
product of GDPs)

cage distance impact real value

common official 1.206 x
language
colonial linkage 1.017 x
trade agreements 2.195 x
physical distance 0.499 8681 km
common border 1.682 x
GDP per capita ratio 0.913 FR GDP / BR GDP =
2.032

Although the distance between Brazil and France is very important (more than
8500 km), the analysis of the CAGE distance shows us that in spite of the
distance the economic, commercial and social relationship between the two
countries is already well established and also promising.
as shown in the table above, almost all CAGE distance ratios have a value
greater than 1 except for physical distance and gdp per capita. this means that it
promotes and increases future trade and goods flows

3. Estimate the current trade flow between the two countries (based on
available trade statistics) and interpret it according to predictors (% of
world) based on the distance and size effects only model and the full model

What leads to trade between countries is above all the interests and
commercial agreements that allow both countries to be profitable. In addition,
each country is better able to produce certain products, which allows them to be
exported and vice versa. Indeed, it may cost the country more to produce a
product that it already imports if the land or territory is not suitable for its
production.
 Currently the total exports to Brazil are 2.2% in the world. Brazil is a
country that exports a lot of meat to the world, especially chicken. However,
this figure is based on a comparison with France and allows us to see the
advantages of Brazil's entry into this market.