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Determinants of Trade Specialization in the New EU Member States


  • Dora Borbély

    () (Europäisches Institut für Internationale Wirtschaftsbeziehungen (EIIW))


European integration brings about major impulses for structural change in industry within the enlarged European Union. Underlying paper aims at explaining trade specialization patterns of the new EU member states as suppliers on the EU 15 market. The analysis is based on the key shifts in sectoral developments as shown via changing RCA indicators of relative export shares to the EU15. A dynamic panel analysis displays that the most important factors driving comparative advantages in trade are industrial production, export unit values, FDI, R&D, and low relative wages as compared to the EU 15 countries. The impact of these variables varies considerably when dealing either with total manufacturing, with labour intensive or with high-tech industries.

Suggested Citation

  • Dora Borbély, 2005. "Determinants of Trade Specialization in the New EU Member States," EIIW Discussion paper disbei138, Universitätsbibliothek Wuppertal, University Library.
  • Handle: RePEc:bwu:eiiwdp:disbei138

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    References listed on IDEAS

    1. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    2. Frank Windmeijer, 2000. "A finite sample correction for the variance of linear two-step GMM estimators," IFS Working Papers W00/19, Institute for Fiscal Studies.
    3. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    4. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
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    More about this item


    trade specialization; comparative advantage; dynamic panel analysis;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General


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