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Trade Specialisation and Economic Convergence: Evidence from two Eastern European Countries

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  • Guglielmo Maria Caporale
  • Christophe Rault
  • Robert Sova
  • Anamaria Sova

Abstract

This paper analyses trade specialisation dynamics in two Eastern European countries (Romania and Bulgaria – EEC-2) vis-à-vis the core EU member states (EU-15) over the period 1990-2006. Specifically, we focus on whether there is a shift towards intra-industry trade leading to economic convergence and technological catch-up. We use recently developed static (FEM, REM and FEVD) and dynamic (GMM) panel data methods which take into account possible heterogeneity. Our empirical results indicate that intra-industry trade has indeed increased, but it is of the vertical rather than the horizontal type, resulting in complementary rather than competitive production patterns.

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Bibliographic Info

Paper provided by DEGIT, Dynamics, Economic Growth, and International Trade in its series DEGIT Conference Papers with number c016_071.

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Length: 28 pages JEL Classification: F13, F15, C23
Date of creation: Sep 2011
Date of revision:
Handle: RePEc:deg:conpap:c016_071

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Keywords: Gravity Models; Panel Data models; Trade Specialisation; Comparative Advantage;

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References

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Cited by:
  1. Eleonora Cavallaro & Piero Esposito & Alessia Matano & Marcella Mulino, 2013. "Technological Catching Up, Quality of Exports, and Competitiveness: A Sectoral Perspective," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., M.E. Sharpe, Inc., vol. 49(6), pages 4-21, November.
  2. Dumitru Miron & Alina Mihaela Dima & Simona Vasilache, 2010. "Models Of The Intra-Regional Trade Influence On Economic Sustainable Development In Romania," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 12(27), pages 27-35, February.
  3. Marius-Razvan Surugiu & Camelia Surugiu, 2012. "Intra-industry trade in Romania: analysis of the automobile parts and accessories sector," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, Inderscience Enterprises Ltd, vol. 4(1/2), pages 166-179.

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