IDEAS home Printed from
   My bibliography  Save this paper

Quality-adjusted similarity of EU-countriesŽ export structure


  • Kaitila, Ville


We propose a new way to measure the extent to which countries compete in their exports. We augment the similarity index proposed by Finger and Kreinin (1979) with product quality. Quality is measured using unit export prices in the tradition of the horizontal/vertical intra-industry trade literature. We analyse the EU27 countries export structures using 1) overall similarity à la Finger and Kreinin, 2) same-quality similarity, and 3) quality-adjusted similarity that combines the first two measures. We find that the similarity of the export structures of the new member countries and the cohesion countries vis-à-vis the non-cohesion EU15 countries has increased, but that there remains a divide between them especially in terms of same-quality exports.

Suggested Citation

  • Kaitila, Ville, 2010. "Quality-adjusted similarity of EU-countriesŽ export structure," Discussion Papers 1227, The Research Institute of the Finnish Economy.
  • Handle: RePEc:rif:dpaper:1227

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Luca De Benedictis & Lucia Tajoli, 2007. "Openness, similarity in export composition, and income dynamics," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 16(1), pages 93-116.
    2. David Greenaway & Robert Hine & Chris Milner, 1994. "Country-specific factors and the pattern of horizontal and vertical intra-industry trade in the UK," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 130(1), pages 77-100, March.
    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. Finger, J M & Kreinin, M E, 1979. "A Measure of 'Export Similarity' and Its Possible Uses," Economic Journal, Royal Economic Society, vol. 89(356), pages 905-912, December.
    5. Torfinn Harding & Beata Smarzynska Javorcik, 2009. "A Touch of Sophistication: FDI and Unit Values of Exports," CESifo Working Paper Series 2865, CESifo Group Munich.
    6. Krugman, Paul R, 1981. "Intraindustry Specialization and the Gains from Trade," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 959-973, October.
    7. Flam, Harry & Helpman, Elhanan, 1987. "Vertical Product Differentiation and North-South Trade," American Economic Review, American Economic Association, vol. 77(5), pages 810-822, December.
    8. Nuno Crespo & Maria Paula Fontoura, 2007. "Integration of CEECs into EU Market: Structural Change and Convergence," Journal of Common Market Studies, Wiley Blackwell, vol. 45, pages 611-632, September.
    9. Lionel Fontagné & Guillaume Gaulier & Soledad Zignago, 2008. "Specialization across varieties and North-South competition," Economic Policy, CEPR;CES;MSH, vol. 23, pages 51-91, January.
    10. Aiginger, Karl, 1997. "The Use of Unit Values to Discriminate between Price and Quality Competition," Cambridge Journal of Economics, Oxford University Press, vol. 21(5), pages 571-592, September.
    11. Antimiani, Alessandro & Henke, Roberto, 2006. "Old and new partners: similarity and competition in the EU foreign trade," 98th Seminar, June 29-July 2, 2006, Chania, Crete, Greece 10082, European Association of Agricultural Economists.
    12. Petr Jansky, 2010. "Rising unit values of Central and Eastern European exports: Rising quality in transition?," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 3(2), pages 147-157.
    13. David Hummels & Peter J. Klenow, 2005. "The Variety and Quality of a Nation's Exports," American Economic Review, American Economic Association, vol. 95(3), pages 704-723, June.
    14. Greenaway, David & Hine, Robert C & Milner, Chris, 1995. "Vertical and Horizontal Intra-industry Trade: A Cross Industry Analysis for the United Kingdom," Economic Journal, Royal Economic Society, vol. 105(433), pages 1505-1518, November.
    Full references (including those not matched with items on IDEAS)


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

    Cited by:

    1. Kaitila, Ville, 2013. "Specialisation and/or Convergence: Structure of European Exports and Production," ETLA Working Papers 12, The Research Institute of the Finnish Economy.
    2. Crespo, Nuno & Simões, Nádia, 2012. "On the measurement of a multidimensional concept of structural similarity," Economics Letters, Elsevier, vol. 116(1), pages 115-117.

    More about this item


    exports; similarity; quality;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    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:rif:dpaper:1227. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Kaija Hyvönen-Rajecki). General contact details of provider: .

    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.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.