Trade economists agree now that the new feature of globalization is an explosion of world trade in intermediate goods and in foreign direct investment, while the trade exposure of rich has not increased over the last 100 years.
The raise of trade in intermediate goods and in foreign direct investment are the signs of the new way firms organize their activities.
The value chain has become global.
The global firm produces one stage of production in one location and exports the input for refinement to a second location.
The refined input gets further refinement in a third location.
During this refinement process intermediate goods are traded from one location to the next.
This way, the international organization of production leads to the observed increase in trade in intermediate goods and in foreign direct investment.
Parallel to these changes in the world economy the corporate sector in rich economies has gone through an enormous amount of reorganization (Marin and Verdier, 2003:337).