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Austrian border regions and eastern integration: A low competitiveness - high growth paradoxon

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  • Mayerhofer, Peter

Abstract

Many regions on the EU Eastern borders have developed favourably after the opening up of the border and the implementation of association agreements with the CEECs. This was often seen as a positive sign for the further perspectives of these regions after EU enlargement. In this paper we take a closer look at the mechanisms involved in a case study for Austria. Based on a very disaggregated data set at a regional as well as sectoral level we find that neither sectoral preconditions nor locational advantages can explain the good performance of (rural) border regions after 1989. Using multivariate cluster analyses we group 3-digit-industries to theoretically founded typologies indicating different sector characteristics and find that (fast growing) rural border regions are dominated by industries that show disadvantageous characteristics for eastwest trade. Furthermore, we identify locational factors relevant for regional growth in a traditional Barro-style growth regression and find a regional distribution of these factors in Austria, which also places rural border regions at a disadvantage. Rather than these factors or advantages from proximity to the new markets, impacts internal to the Austrian markets seem to determine regional growth patterns in the 1990s. Therefore it would be misleading to take a stable development of rural border regions after EU enlargement for granted due to past experiences.

Suggested Citation

  • Mayerhofer, Peter, 2002. "Austrian border regions and eastern integration: A low competitiveness - high growth paradoxon," HWWA Discussion Papers 202, Hamburg Institute of International Economics (HWWA).
  • Handle: RePEc:zbw:hwwadp:26234
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    Cited by:

    1. Franz R. Hahn, 2005. "Testing for Profitability and Contestability in Banking," WIFO Working Papers 261, WIFO.
    2. Franz Hahn, 2007. "Environmental determinants of banking efficiency in Austria," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 34(3), pages 231-245, July.

    More about this item

    Keywords

    Border Regions; Integration; EU Enlargement; Regional Competitiveness; Austria;

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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