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Explaining Economic Restructuring: An input-output analysis of organisational change in the European Union


  • Michael Dietrich


This article investigates the extent to which the European economy (as a whole) has entered a period of restructuring from 1970 to the present, and assesses whether different theories of restructuring can explain the processes involved.Three political economy perspectives on restructuring are presented: flexible specialisation, neo-Schumpeterian/long wave, and Regulation. The extent of organisational restructuring is identified using an input-output methodology that separates supply-side and demand-side change. Supplyside output change indicates the importance of vertical externalisation, which all restructuring theories identify as important. This empirical methodology is applied using EU wide input-output tables for 1970, 1975, 1980, 1985 and 1991. Considerable restructuring is indicated as having occurred, particularly in European manufacturing industry. But this restructuring seems not to be consistent with any single perspective; rather all three are relevant in different circumstances. Finally, an attempt is made to sketch a theory of the firm consistent with the evidence presented.

Suggested Citation

  • Michael Dietrich, 1999. "Explaining Economic Restructuring: An input-output analysis of organisational change in the European Union," International Review of Applied Economics, Taylor & Francis Journals, vol. 13(2), pages 219-240.
  • Handle: RePEc:taf:irapec:v:13:y:1999:i:2:p:219-240
    DOI: 10.1080/026921799101670

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    References listed on IDEAS

    1. Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-1171, September.
    2. Michael Dietrich, 1993. "Total Quality Control, Just-in-Time Management, and the Economics of the Firm," Journal of Economic Studies, Emerald Group Publishing, vol. 20(6), pages 17-31, October.
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    Cited by:

    1. Sandro Montresor & Giuseppe Vittucci Marzetti, 2011. "The deindustrialisation/tertiarisation hypothesis reconsidered: a subsystem application to the OECD7," Cambridge Journal of Economics, Oxford University Press, vol. 35(2), pages 401-421.
    2. S. Montresor & G. Vittucci Marzetti, 2006. "Outsourcing and structural change: shifting firm and sectoral boundaries," Working Papers 566, Dipartimento Scienze Economiche, Universita' di Bologna.
    3. Tregenna, F., 2009. "Contracting Out of Service Activities and the Effects on Sectoral Employment Patterns in South Africa," Cambridge Working Papers in Economics 0906, Faculty of Economics, University of Cambridge.
    4. G. Vittucci Marzetti, 2008. "Input-output data and service outsourcing. A reply to Dietrich, McCarthy and Anagnostou," Working Papers 621, Dipartimento Scienze Economiche, Universita' di Bologna.

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