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Intra-Industry Trade in Agri-Food Products between Hungary and EU

Author

Listed:
  • Imre Ferto

    () (Institute of Economics of Hungarian Academy of Sciences)

  • Lionel J. Hubbard

    () (Department of Agricultural Economics and Food Marketing, University of Newcastle upon Tyne, UK)

Abstract

We present an analysis of the intra-industry nature of agri-food trade between Hungary and the European Union, following the Association Agreement signed in 1991. A slight growth in intra-industry trade (IIT) is indicated by the Grubel-Lloyd index. However, it is not uniform by product group or EU member state or over time, reflecting different patterns of bilateral integration and an economic restructuring process that is far from complete. Marginal IIT appears to be low, but assumes greater significance when the index is broadened to include vertical as well as horizontal IIT. Accordingly, the structure of the change in agri-food trade between Hungary and the EU during the period is shown to be predominantly either intra– industry of a vertical nature or inter-industry. Both are believed to incur adjustment costs that are higher than with horizontal IIT, but the dominance of vertical IIT suggests that the agri-food industries of Hungary and the EU may be developing in a complementary manner, involving somewhat lower adjustment costs than may have been feared.

Suggested Citation

  • Imre Ferto & Lionel J. Hubbard, 2001. "Intra-Industry Trade in Agri-Food Products between Hungary and EU," IEHAS Discussion Papers 0106, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
  • Handle: RePEc:has:discpr:0106
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    References listed on IDEAS

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    Cited by:

    1. Levkovych, Inna, 2011. "Der ukrainische Außenhandel mit Produkten der Agrar- und Ernährungswirtschaft: Eine quantitative Analyse aus Sicht traditioneller und neuer Außenhandelstheorien," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 59, number 109520.

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