IDEAS home Printed from https://ideas.repec.org/p/wii/rpaper/rr279.html
   My bibliography  Save this paper

Patterns of Catching-Up in Candidate Countries' Manufacturing Industry

Author

Listed:
  • Peter Havlik

Abstract

This paper analyses the structural changes that have taken place in CEE candidate countries' manufacturing industry during the last decade. In the more advanced candidate countries for EU membership, industry has been able to recover at least part of its previous position thanks to active restructuring and privatization efforts, fostered especially by inflows of FDI. Employment declined more than output and over five million manufacturing jobs were lost in the region between 1990 and 1999. Production specialization has markedly increased between 1990 and 1999 in nearly all candidate countries. The top five branches account for 60% to more than 70% of manufacturing industry output. The structure of manufacturing industry in the majority of candidate countries is now fairly close to the European pattern both in terms of production and employment (exceptions are Bulgaria, Romania and the Baltic states). A new pattern of productivity winner and loser branches is emerging winners are electrical, optical and transport equipment as well as furniture; losers are food and beverages, textiles, leather, wood products and chemicals. Hungary is a productivity leader among the candidate countries; Bulgarian and Romanian labour productivity is just one fourth of the Hungarian level. In several countries wages are growing faster than productivity, implying a gradual deterioration of the international labour cost competitiveness (except Hungary and possibly also Poland). The winner branches have managed to increase their comparative cost advantages vis-à-vis the present EU member states. But some loser branches - such as textiles, leather and wood products - face clear cost problems and may well have higher unit labour costs than Western Europe. Manufacturing industry has been an important target of FDI in the candidate countries, but the sectoral distribution of FDI is highly uneven. FDI has a clearly positive impact on output growth, labour productivity and ULC improvements.

Suggested Citation

  • Peter Havlik, 2001. "Patterns of Catching-Up in Candidate Countries' Manufacturing Industry," wiiw Research Reports 279, The Vienna Institute for International Economic Studies, wiiw.
    • Handle: RePEc:wii:rpaper:rr:279
    as

    Download full text from publisher

    File URL: https://wiiw.ac.at/patterns-of-catching-up-in-candidate-countries-manufacturing-industry-dlp-203.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gács, János, 2002. "Structural Change and Catching Up: Experience of the Ten Candidate Countries," MPRA Paper 60339, University Library of Munich, Germany.
    2. Dr Johannes Stephan, 2004. "Evolving Structural Patterns in the Enlarging European Division of Labour: Sectoral and Branch Specialisation and the Potentials for Closing the Productivity Gap," Development and Comp Systems 0403003, University Library of Munich, Germany.
    3. Vasily Astrov & Vladimir Gligorov & Peter Havlik & Leon Podkaminer, 2003. "Monthly Report 03/2003," wiiw Monthly Reports 2003-03, The Vienna Institute for International Economic Studies, wiiw.
    4. Stephan, Johannes, 2002. "Industrial Specialisation and Productivity Catch-Up in CEECs - Patterns and Prospects -," IWH Discussion Papers 166/2002, Halle Institute for Economic Research (IWH).
    5. Stephan, Johannes, 2003. "EU Accession Countries’ Specialisation Patterns in Foreign Trade and Domestic Production - What can we infer for catch-up prospects?," IWH Discussion Papers 184/2003, Halle Institute for Economic Research (IWH).

    More about this item

    Keywords

    CEE candidate countries; industrial restructuring; productivity comparisons; foreign direct investments; structural and technological change;
    All these keywords.

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F15 - International Economics - - Trade - - - Economic Integration
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • P27 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Performance and Prospects

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wii:rpaper:rr:279. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Customer service (email available below). General contact details of provider: https://edirc.repec.org/data/wiiwwat.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.