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Production processes are fragmenting across borders with countries trading tasks rather than products. Export statistics based on value added reveal a process of vertical specialisation. Yet, what do countries do when exporting? In this article, we provide novel evidence on functional specialisation (FS) in trade. We find surprisingly large and pervasive heterogeneity in specialisation across countries. A positive (negative) correlation between GDP per capita and specialisation in R&D (fabrication) functions is documented. Specialisation in management and marketing functions is unrelated to income. We show how our approach can be easily extended to study FS in trade at the sub-national level. We argue that this is needed to better understand the potential for regional development under global integration.

This work proposes a new measure of the routine content of occupations and sectors for 20 OECD countries, based on information about the sequence and flexibility of the tasks performed on the job. A negative but weak association emerges between routineness and skill intensity, which suggests the importance of both technological and organizational considerations in the measure of routine intensity. Between 2000 and 2010, employment mainly grew in non-routine occupations, especially in market services, while manufacturing shed routine and non-routine jobs. Changes in shares of employment by routine quartile are dominated by within-effects.