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Skill Content of Intra-European Trade Flows

Author

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  • Goetz Zeddies

Abstract

In recent decades, the international division of labor has expanded rapidly in the wake of European integration. In this context, especially Western European high-wage countries should have specialized on (human-)capital intensively manufactured goods and should have increasingly sourced labor-intensively manufactured goods, especially parts and components, from Eastern European low wage countries. Since this should be beneficial for the high-skilled and harmful to the lower-qualified workforce in high-wage countries, the opening up of Eastern Europe is often considered as a vital reason for increasing unemployment of the lower-qualified in Western Europe. This paper addresses this issue by analyzing the skill content of Western European countries’ bilateral trade using input-output techniques in order to evaluate possible effects of international trade on labor demand. Thereby, differences in factor inputs and production technologies have been considered, allowing for vertical product differentiation. In this case, skill content of bilateral exports and imports partially differs substantially, especially in bilateral trade between Western and Eastern European countries. According to the results, East-West trade should be harmful particularly to the medium-skilled in Western European countries.

Suggested Citation

  • Goetz Zeddies, 2013. "Skill Content of Intra-European Trade Flows," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 10(1), pages 81-107, April.
  • Handle: RePEc:liu:liucej:v:10:y:2013:i:1:p:81-107
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    Citations

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    Cited by:

    1. Simplice A. Asongu, Nicholas M. Odhiambo, 2021. "Taxation, foreign aid and political governance in Africa," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 18(2), pages 217-249, December.
    2. Kuznetsov, D.E. (Кузнецов Д.Е.), 2016. "Import, Export and Consumption of Russia in Terms of Jobs [Импорт, Экспорт И Потребление России В Терминах Рабочих Мест]," Working Papers 1856, Russian Presidential Academy of National Economy and Public Administration.
    3. Asongu Simplice, 2014. "Taxation, foreign aid and political governance: figures to the facts of a celebrated literature," Working Papers of the African Governance and Development Institute. 14/022, African Governance and Development Institute..
    4. Fabio Antoniou & Panos Hatzipanayotou & Nikos Tsakiris, 2019. "Destination‐based vs. Origin‐based Commodity Taxation in Large Open Economies with Unemployment," Economica, London School of Economics and Political Science, vol. 86(341), pages 67-86, January.

    More about this item

    Keywords

    European Integration; International Trade; Labor Demand; Input-Output Analysis;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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