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Accession Countries’ Comparative Advantage in the Internal

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Author Info
Ville Kaitila (The Research Institute of the Finnish Economy)

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Abstract

We analyse trade between Central and Eastern European (CEE) countries and the European Union during 1993-1998 using three methods. First, we calculate the share of intra-industry trade to determine the ex-tent to which two countries trade in similar products. Second, we calculate similarity indices to determine the extent to which the structure of the exports of two countries is similar to a third country. Third, we calculate the revealed comparative advantage of CEE countries in the EU internal market and analyse the results in a two-dimensional space showing relative labour-skills and capital-intensity. We also depict how the factor intensity of comparative advantage has changed since 1993. With this last approach, we find that the comparative advantage of various CEE countries have developed in quite different direc-tions. Some countries have evolved comparative advantage in industries requiring much skilled labour, while others have moved in the opposite direction. This differentiation is also reflected in degrees of capital intensity. A few CEE countries have not shifted in this two-dimensional space.

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Publisher Info
Paper provided by EconWPA in its series International Trade with number 0209001.

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Length: 45 pages
Date of creation: 19 Sep 2002
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Handle: RePEc:wpa:wuwpit:0209001

Note: Type of Document - pdf; prepared on PC; pages: 45
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Web page: http://129.3.20.41

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Related research
Keywords: EU; eastern enlargement; comparative advantage; factor intensity;

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Find related papers by JEL classification:
F1 - International Economics - - Trade
F2 - International Economics - - International Factor Movements and International Business

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Ville Kaitila & Mika Widgrén, 1999. "Revealed Comparative Advantage in Trade between the European Union and the Baltic States," Discussion Papers 697, The Research Institute of the Finnish Economy. [Downloadable!]
  2. Richard E. Baldwin & Joseph F. Francois & Richard Portes, 1997. "The costs and benefits of eastern enlargement: the impact on the EU and central Europe," Economic Policy, CEPR, CES, MSH, vol. 12(24), pages 125-176, 04. [Downloadable!] (restricted)
  3. Grubel, Herbert G & Lloyd, P J, 1971. "The Empirical Measurement of Intra- Industry Trade," The Economic Record, The Economic Society of Australia, vol. 47(120), pages 494-517, December.
  4. Jarko Fidrmuc & Daniela Grozea-Helmenstein & Andreas Wörgötter, 1999. "East-west intra-industry trade dynamics," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 135(2), pages 332-346, June. [Downloadable!] (restricted)
  5. Aturupane, Chonira & Djankov, Simeon & Hoekman, Bernard, 1997. "Determinants of intra-industry trade between East and West Europe," Policy Research Working Paper Series 1850, The World Bank. [Downloadable!]
    Other versions:
  6. Paul Brenton & Francesca Di Mauro & Matthias Lücke, 1999. "Economic Integration and FDI: An Empirical Analysis of Foreign Investment in the EU and in Central and Eastern Europe," Empirica, Springer, vol. 26(2), pages 95-121, June. [Downloadable!] (restricted)
  7. Kaitila, Ville, 1999. "Trade and Revealed Comparative Advantage: Hungary, the Czech Republic, and the European Union," BOFIT Discussion Papers 8/1999, Bank of Finland, Institute for Economies in Transition. [Downloadable!]
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Ville Kaitila, 2003. "Convergence of Real GDP per Capita in the EU15 area: How do the Accession Countries Fit in ?," Discussion Papers 865, The Research Institute of the Finnish Economy. [Downloadable!]
  2. Fidrmuc, Jarko & Korhonen, Iikka, 2001. "Similarity of supply and demand shocks between the Euro area and the CEECs," BOFIT Discussion Papers 14/2001, Bank of Finland, Institute for Economies in Transition. [Downloadable!]
    Other versions:
  3. Ville Kaitila, 2004. "Convergence of real GDP per capita in the EU15. How do the Accession Countries fit in?," Economics Working Papers 025, European Network of Economic Policy Research Institutes. [Downloadable!]
  4. Laura Ehrlich, 2002. "The EU Single Market and Customs Policy: Impact on Estonian Foreign Trade," Discussion Papers 797, The Research Institute of the Finnish Economy. [Downloadable!]
  5. J. Caetano & A. Galego & E. Vaz & C. Vieira & I. Vieira, 2002. "The Eastward Enlargement of the Eurozone: Trade and FDI," Eastward Enlargement of the Euro-zone Working Papers wp07, Free University Berlin, Jean Monnet Centre of Excellence, revised 01 Aug 2002. [Downloadable!]
  6. Mika Wirgrén, 2006. "Trade Potential, Intra-industry Trade and Factor Content Revealed Comperative Advantage in the Baltic Sea Region," Discussion Papers 1034, The Research Institute of the Finnish Economy. [Downloadable!]
  7. Jarko Fidrmuc, 2005. "Trade Structure during Accession to the EU," Post-Communist Economies, Taylor and Francis Journals, vol. 17(2), pages 225-234, June. [Downloadable!] (restricted)
  8. Mika Widgrén, 2005. "Revealed Comparative Advantage in the Internal Market," Discussion Papers 989, The Research Institute of the Finnish Economy. [Downloadable!]
  9. Fidrmuc, Jarko & Korhonen, Iikka, 2004. "A meta-analysis of business cycle correlation between the euro area and CEECs: What do we know – and who cares?," BOFIT Discussion Papers 20/2004, Bank of Finland, Institute for Economies in Transition. [Downloadable!]
  10. Ville Kaitila, 2004. "The Factor Intensity of Accession and EU15 Countries´ Comparative Advantage in the Internal Market," Discussion Papers 925, The Research Institute of the Finnish Economy. [Downloadable!]
  11. Fidrmuc, Jarko & Korhonen, Iikka, 2003. "The euro goes East. Implications of the 2000-2002 economic slowdown for synchronisation of business cycles between the euro area and CEEs," BOFIT Discussion Papers 6/2003, Bank of Finland, Institute for Economies in Transition. [Downloadable!]
    Other versions:
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