Macroeconomic shocks, investment volatility and centrality in global manufacturing network

In this paper, based on the investment behavior of publicly listed manufacturing companies in major economies, we analyze the impacts of macroeconomic systematic shocks on the cyclicality of industrial investment volatility and on the centrality of major economies in global manufacturing network. Two facts are established: (1) the cyclicality of investment volatility in major economies shows to be more countercyclical after 2008, indicating that the downward systematic shocks after 2008 resulted in higher investment volatilities in these major economies through the effect of increased uncertainty accompanying the downward shocks; (2) the impact of global systematic shocks on global manufacturing is making the linkages between industrial investments in major manufacturing economies closer during the period 2002-2020, resulting in an increased centrality of major economies. We consider this as an effect of the counter-globalization trend.