The internationalisation of supply chains has been revolutionising international trade and trade policy for years. This column argues that expansion of international supply chains helps explain the so-called ‘distance paradox’, i.e. the fact that geography is still a powerful shaper of trade patterns despite declines in transport costs. It also argues that trade policy has played a prominent role in driving the expansion of global supply chains.

Global value chains and the international fragmentation of production challenge well-established trade policy models and raise new issues. Yet research has been hindered by the limited availability of proper statistics. This column introduces the World Input-Output Database (WIOD), a new public data source that offers unique opportunities to study the effects of fragmentation on a range of socioeconomic and environmental issues.

Financial innovation has brought about several new ways to trade equities: electronically, over-the-counter, through broker-dealer networks, and so on. But not all of the transactions are transparent, with many barely visible to outsiders – a practice known as ‘dark’ trades. This column finds that, in general, more ways to trade is a benefit, except when the trades are dark.