Dirk Pilat is Deputy Director of the Directorate for Science, Technology and Innovation at the OECD. Prior to his work at the OECD, he earned his PhD in economics in 1994 at the University of Groningen. He spoke at the GGDC Conference 2017 on the OECD’s work on productivity and global value chains, and how the organisation cooperates with the Groningen Growth and Development Centre. FEB Blog asked him about how data figures in his work and Groningen’s contribution to the global economics community.

Q. How have you used GGDC data in your work?

A. There has been cooperation between the GGDC and the OECD for many years. We are users of the databases, particularly of the World Input-Output Database but also of the KLEMS database, but we are also developing our own databases in a slightly different way. We are often in friendly competition with the GGDC, that also involves much cooperation.

There is quite a bit of work at the OECD using data and analysis from GGDC. That’s partly because the GGDC is one of the few places in the world, together with the OECD, where this type of data is being developed. Many universities don’t do much work on databases, because they think it’s too time consuming. It is great that GGDC is doing this. It’s important because a good evidence base and databases provide insights on issues that many countries are dealing with, often offering a new angle on it

Q. Can you give an example of how GGDC data has been useful?

A. WIOD is a good example. Until not long ago, people thought imports were bad and exports were good. However the discussion of global value chains makes clear you need imports in order to have exports. The Apple iPhone is assembled in China, but a lot of the inputs come from other countries. If we just look at the exports from China we are getting the wrong picture of who is creating value and who are the biggest players. That’s why it’s important to know what’s really going on in global trade, and the World Input-Output Database allows us to do that. It’s the kind of work that has helped to change thinking in these areas and what we need to do for trade. It shows the interconnections between countries, how we depend on each other. WIOD gives a much better picture for policymakers, to allow them to figure out what they need to do.

The work on productivity is also very important. Productivity is a very big issue on the policy agenda in many countries, as many are struggling with low productivity growth. The more we know about it the better we can address it.

Q. Could you describe the reputation of GGDC in the economics research community?

A. I think GGDC has a good and growing reputation. There’s a lot of appreciation here at the OECD for what is done at the GGDC, and it’s a source for a lot of ideas. For the OECD, GGDC is one of the few organisations that is doing similar work to us. We can compare experiences, and it’s very useful for us that GGDC is also doing this kind of work.

I think the work speaks for itself, a lot of people are using the data and are aware of the data. GGDC is now also bringing in other data like the Penn World Tables, which is  an opportunity to make its work known to others and put GGDC even more on the map. The data itself speaks for itself, but the analysis that’s done with it can further help advertise the work.

Q. How did your experience as a researcher in Groningen help your future career?

A. I partly ended up where I am at the moment coming from Groningen because I was working with Angus Maddison. Angus had worked at the OECD for 25 years and encouraged me to apply.

Many things I learned in Groningen have been helpful for me: the importance of data, evidence and empirical analysis; the value of cross-country analysis, which is something we are doing a lot here at OECD - where Angus received some of his inspiration. I sometimes run into people who started in Groningen, who also have this basis. For example, I was at a conference in Valencia on the role of IT in productivity in 2005 with four speakers who studied in Groningen. Bart van Ark was one of them, and the two others worked at the European Commission and the European Central Bank. I think this shows the type of basis Groningen can give you: being evidence based and not too theoretical in your work.

Q. What should the GGDC focus on more in the future?

A. I think there are some areas where we’re doing things that complement what GGDC is doing. For examine, micro data from statistical offices can provide more detailed insights. That could be something to develop, but that’s a choice to be made. There are always more extensions to the data that are possible. The question is whether to broaden the databases or deepen work in some specific areas. Perhaps there could also be more connections between different areas: such as between productivity and global value chains and also with the historical work.

There’s a lot of good work going on, and the issues that GGDC has long been working on are becoming more and more important. Some of these areas were once only niche areas. Until 10 years ago no one spoke about global value chains, but now they are a really hot topic. With the discussion on global trade heating up in many places, these are areas which are going to be ever more important.