EU Integration and Production Networks: Evidende from Spain
The aim of this paper is to advance knowledge of Spainâ€šÃ„Ã´s participation in international production networks using data on trade in parts and components from 1990 to 2006. Data analysis shows a remarkable dynamism of Spanish trade in P&C, both in imports and exports, being capable of keeping their shares despite the intense competition from less developed countries. Additionally, Spanish participation in networks is mostly in Europe. In fact, Spain has maintained itself as one of the primary destinations of European P&C exports and has been the only economy that has improved its position as a supplier. These facts allow us to infer a significant competitive capacity of the Spanish economy in Europe, for both production and assembly of P&C. The EU enlargement to Eastern European countries seems not to have damaged Spanish competitiveness as an assembler. In order to analyse the nature of Spanish participation in production networks, we estimate the determinants of trade in P&C using an extended gravity panel data model. In addition to the standard variables in gravity models, we also examine the role of differences in technology and factor endowment between Spain and its trading partners, and the role of service link costs in P&C trade. We find that Spainâ€šÃ„Ã´s integration in production networking responds to comparative advantage but also to other factors such as EU membership and a good quality transport and communication infrastructures. Some lessons from the experience of a middle-income country like Spain may be useful for the CEECs, which have increased their presence in European production sharing in the last decade. Future EU enlargement towards lower costs countries could threaten their position in networking. The reinforcement of these other factors, besides comparative advantage, would act as key element to strengthen their participation in cross-border networks. Key Words: international production networks, trade in P&C, Spanish economy, EU, gravity model.
|Date of creation:||Sep 2011|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.ersa.org
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.:
- Elhanan Helpman & Marc Melitz & Yona Rubinstein, 2008.
"Estimating Trade Flows: Trading Partners and Trading Volumes,"
The Quarterly Journal of Economics,
MIT Press, vol. 123(2), pages 441-487, 05.
- Rubinstein, Yona & Helpman, Elhanan & Melitz, Marc, 2008. "Estimating Trade Flows: Trading Partners and Trading Volumes," Scholarly Articles 3228230, Harvard University Department of Economics.
- Elhanan Helpman & Marc Melitz & Yona Rubinstein, 2007. "Estimating Trade Flows: Trading Partners and Trading Volumes," NBER Working Papers 12927, National Bureau of Economic Research, Inc.
- Kimura, Fukunari & Takahashi, Yuya & Hayakawa, Kazunobu, 2007. "Fragmentation and parts and components trade: Comparison between East Asia and Europe," The North American Journal of Economics and Finance, Elsevier, vol. 18(1), pages 23-40, February.
- Baier, Scott L. & Bergstrand, Jeffrey H., 2001. "The growth of world trade: tariffs, transport costs, and income similarity," Journal of International Economics, Elsevier, vol. 53(1), pages 1-27, February.
- Richard Baldwin & Virginia DiNino & Lionel Fontagn� & Roberto A. De Santis & Daria Taglioni, 2008. "Study on the Impact of the Euro on Trade and Foreign Direct Investment," European Economy - Economic Papers 321, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
- Deardorff, A.V., 1998.
"Fragmentation in Simple Trade Models,"
422, Research Seminar in International Economics, University of Michigan.
- Deardorff, Alan V., 2001. "Fragmentation in simple trade models," The North American Journal of Economics and Finance, Elsevier, vol. 12(2), pages 121-137, July.
- Jones, Ronald & Kierzkowski, Henryk & Lurong, Chen, 2005. "What does evidence tell us about fragmentation and outsourcing?," International Review of Economics & Finance, Elsevier, vol. 14(3), pages 305-316.
- Götz Zeddies, 2007. "Determinants of International Fragmentation of Production in the European Union," IWH Discussion Papers 15, Halle Institute for Economic Research.
- Feenstra, Robert C, 2002. "Border Effects and the Gravity Equation: Consistent Methods for Estimation," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 491-506, December.
- Helpman, Elhanan, 1987. "Imperfect competition and international trade: Evidence from fourteen industrial countries," Journal of the Japanese and International Economies, Elsevier, vol. 1(1), pages 62-81, March.
- James E. Anderson & Eric van Wincoop, 2003.
"Gravity with Gravitas: A Solution to the Border Puzzle,"
American Economic Review,
American Economic Association, vol. 93(1), pages 170-192, March.
- James E. Anderson & Eric van Wincoop, 2001. "Gravity with Gravitas: A Solution to the Border Puzzle," NBER Working Papers 8079, National Bureau of Economic Research, Inc.
- James E. Anderson & Eric van Wincoop, 2000. "Gravity with Gravitas: A Solution to the Border Puzzle," Boston College Working Papers in Economics 485, Boston College Department of Economics.
- Anderson, James E, 1979. "A Theoretical Foundation for the Gravity Equation," American Economic Review, American Economic Association, vol. 69(1), pages 106-16, March.
- Carmen Mora, 2002. "The role of comparative advantage in trade within industries: A panel data approach for the European Union," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 138(2), pages 291-316, June.
- Scott L. Baier & Jeffrey H. Bergstrand, 2005.
"Do free trade agreements actually increase members’ international trade?,"
FRB Atlanta Working Paper
2005-03, Federal Reserve Bank of Atlanta.
- Baier, Scott L. & Bergstrand, Jeffrey H., 2007. "Do free trade agreements actually increase members' international trade?," Journal of International Economics, Elsevier, vol. 71(1), pages 72-95, March.
- Athukorala, Prema-chandra & Yamashita, Nobuaki, 2006.
"Production fragmentation and trade integration: East Asia in a global context,"
The North American Journal of Economics and Finance,
Elsevier, vol. 17(3), pages 233-256, December.
- Prema-chandra Athukorala & Nobuaki Yamashita, 2005. "Production Fragmentation and Trade Integration: East Asia in a Global Context," Departmental Working Papers 2005-07, The Australian National University, Arndt-Corden Department of Economics.
- Prema-chandra Athukorala, 2003.
"Product Fragmentation and Trade Patterns in East Asia,"
Departmental Working Papers
2003-21, The Australian National University, Arndt-Corden Department of Economics.
- Prema-chandra Athukorala, 2005. "Product Fragmentation and Trade Patterns in East Asia," Asian Economic Papers, MIT Press, vol. 4(3), pages 1-27, October.
- Arndt, Sven W., 1997. "Globalization and the open economy," The North American Journal of Economics and Finance, Elsevier, vol. 8(1), pages 71-79.
When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa10p583. 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: (Gunther Maier)
If references are entirely missing, you can add them using this form.