IDEAS home Printed from https://ideas.repec.org/b/wfo/wstudy/46823.html
   My bibliography  Save this book

The Development of Productive Structures of EU Member Countries and Their International Competitiveness

Author

Listed:
  • Andreas Reinstaller

    (WIFO)

  • Werner Hölzl
  • Johannes Kutsam

    (WIFO)

  • Christian Schmid

    (WIFO)

Abstract

This study examines the development of the productive structures of the EU using international trade data and methods from complexity theory referred to as the "product space" approach. The results show that the set of products for which a country has already a comparative advantage in international trade is a strong predictor for the type of products in which it will develop a comparative advantage and obtain significant world market shares. This implies that the development of the productive structures of a country is a highly cumulative process and any upgrading is necessarily deeply rooted in current capabilities and industrial specialisation. Complementary factors and competencies have to be built up. This makes it more difficult for countries to change their productive structures. In the light of the results of this study the smart specialisation strategy which the European Commission pursues in its cohesion policy for the years 2014-2020 seems to be well placed to foster the competitiveness of the European Union in general and the European regions in particular. Some caveats however apply.

Suggested Citation

  • Andreas Reinstaller & Werner Hölzl & Johannes Kutsam & Christian Schmid, 2013. "The Development of Productive Structures of EU Member Countries and Their International Competitiveness," WIFO Studies, WIFO, number 46823.
    • Handle: RePEc:wfo:wstudy:46823
    as

    Download full text from publisher

    File URL: https://www.wifo.ac.at/wwa/pubid/46823
    File Function: abstract
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. John Sutton & Daniel Trefler, 2011. "Deductions from the Export Basket: Capabilities, Wealth and Trade," NBER Working Papers 16834, National Bureau of Economic Research, Inc.
    2. Cesar A. Hidalgo & Ricardo Hausmann, 2009. "The Building Blocks of Economic Complexity," Papers 0909.3890, arXiv.org.
    3. Jürgen Janger & Werner Hölzl & Serguei Kaniovski & Johannes Kutsam & Michael Peneder & Andreas Reinstaller & Susanne Bärenthaler-Sieber & Isabel Stadler & Fabian Unterlass, 2011. "Structural Change and the Competitiveness of EU Member States," WIFO Studies, WIFO, number 42956.
    4. Ricardo Hausmann & Bailey Klinger, 2007. "The Structure of the Product Space and the Evolution of Comparative Advantage," Growth Lab Working Papers 10, Harvard's Growth Lab.
    5. Anna Jankowska & Arne Nagengast & José Ramón Perea, 2012. "The Middle-Income Trap: Comparing Asian and Latin American Experiences," OECD Development Centre Policy Insights 96, OECD Publishing.
    6. Aiginger, Karl, 1997. "The Use of Unit Values to Discriminate between Price and Quality Competition," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 21(5), pages 571-592, September.
    7. Ricardo Hausmann & Jason Hwang & Dani Rodrik, 2007. "What you export matters," Journal of Economic Growth, Springer, vol. 12(1), pages 1-25, March.
    8. Peter K. Schott, 2004. "Across-Product Versus Within-Product Specialization in International Trade," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(2), pages 647-678.
    9. C. A. Hidalgo & B. Klinger & A. -L. Barabasi & R. Hausmann, 2007. "The Product Space Conditions the Development of Nations," Papers 0708.2090, arXiv.org.
    10. Gaulier, Guillaume & Zignago, Soledad, 2004. "Notes on BACI (analytical database of international trade). 1989-2002 version," MPRA Paper 32401, University Library of Munich, Germany.
    11. Cesar A. Hidalgo, 2009. "The Dynamics of Economic Complexity and the Product Space over a 42 year period," CID Working Papers 189, Center for International Development at Harvard University.
    12. Felipe, Jesus & Kumar, Utsav & Abdon, Arnelyn & Bacate, Marife, 2012. "Product complexity and economic development," Structural Change and Economic Dynamics, Elsevier, vol. 23(1), pages 36-68.
    13. Gene M. Grossman & Esteban Rossi-Hansberg, 2008. "Trading Tasks: A Simple Theory of Offshoring," American Economic Review, American Economic Association, vol. 98(5), pages 1978-1997, December.
    14. Helpman, Elhanan, 2011. "Understanding Global Trade," Economics Books, Harvard University Press, number 9780674060784, Spring.
    15. Malerba, Franco & Orsenigo, Luigi, 1995. "Schumpeterian Patterns of Innovation," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 19(1), pages 47-65, February.
    16. Andreas Reinstaller & Fabian Unterlass, 2012. "Innovation at the Firm Level across Countries with Different Economic and Technological Capacity," WIFO Working Papers 436, WIFO.
    17. Ricardo Hausmann & César Hidalgo, 2011. "The network structure of economic output," Journal of Economic Growth, Springer, vol. 16(4), pages 309-342, December.
    18. Anna Jankowska & Arne Nagengast & José Ramón Perea, 2012. "The Product Space and the Middle-Income Trap: Comparing Asian and Latin American Experiences," OECD Development Centre Working Papers 311, OECD Publishing.
    19. Aiginger, K., 1998. "A framework for evaluating the dynamic competitiveness of countries," Structural Change and Economic Dynamics, Elsevier, vol. 9(2), pages 159-188, June.
    20. Pier Saviotti & Koen Frenken, 2008. "Export variety and the economic performance of countries," Journal of Evolutionary Economics, Springer, vol. 18(2), pages 201-218, April.
    21. Andreas Reinstaller & Fabian Unterlass, 2011. "Sectoral Innovation Modes and Level of Economic Development: Implications for Innovation Policy in the New Member States," Chapters, in: Slavo Radosevic & Anna Kaderabkova (ed.), Challenges for European Innovation Policy, chapter 4, Edward Elgar Publishing.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Jürgen Janger & Tim Slickers, 2023. "Wissensproduktion und Wissensverwertung in Österreich im internationalen Vergleich," WIFO Monatsberichte (monthly reports), WIFO, vol. 96(10), pages 699-714, October.
    2. Michael Peneder & Julia Bock-Schappelwein & Matthias Firgo & Oliver Fritz & Gerhard Streicher, 2016. "Österreich im Wandel der Digitalisierung," WIFO Studies, WIFO, number 58979, March.
    3. Karl Aiginger, 2014. "Industrial Policy for a Sustainable Growth Path. WWWforEurope Policy Paper No. 13," WIFO Studies, WIFO, number 47261.
    4. Eckhard Hein & Daniel Detzer, 2014. "Coping with imbalances in the Euro area: Policy alternatives addressing divergences and disparities between member countries," Working papers wpaper63, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    5. Peneder, Michael & Rammer, Christian (ed.), 2018. "Measuring Competitiveness," ZEW Expertises, ZEW - Leibniz Centre for European Economic Research, number 181906.
    6. Michael Peneder & Nicole Schmidt-Padickakudy & Anna Strauss-Kollin & Stefan Weingärtner, 2018. "Österreichs Wettbewerbsfähigkeit im internationalen Vergleich," WIFO Working Papers 565, WIFO.
    7. Valeria Cirillo & Dario Guarascio & Mario Pianta, 2014. "Will Europe?s industry survive the crisis? Competitiveness, employment and the need for an industrial policy," Working Papers 1408, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2014.
    8. Jürgen Janger & Agnes Kügler, 2018. "Innovationseffizienz. Österreich im internationalen Vergleich," WIFO Studies, WIFO, number 61111.
    9. Michael Peneder & Christian Rammer, 2018. "Measuring Competitiveness," WIFO Studies, WIFO, number 60838, March.
    10. Werner Hölzl, 2021. "Structural Change towards Services," WIFO Working Papers 631, WIFO.
    11. Neil Foster-McGregor & Mario Holzner & Michael Landesmann & Johannes Pöschl & Robert Stehrer & Roman Stöllinger, 2013. "A ‘Manufacturing Imperative’ in the EU – Europe's Position in Global Manufacturing and the Role of Industrial Policy," wiiw Research Reports 391, The Vienna Institute for International Economic Studies, wiiw.
    12. repec:wsr:pbrief:y:2014:i:023 is not listed on IDEAS
    13. Mario Pianta, 2014. "An industrial policy for Europe," Working Papers 1401, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2014.
    14. Gunther Tichy, 2015. "Wirtschaftsstandort Österreich – von der "Überholspur" aufs "Abstellgleis"," WIFO Monatsberichte (monthly reports), WIFO, vol. 88(8), pages 635-648, August.
    15. Karl Aiginger & Matthias Firgo & Peter Huber, 2013. "Erfolgsstrategien für die europäische Peripherie. Erkenntnisse für Südeuropa aus der Regionalökonomie," WIFO Monatsberichte (monthly reports), WIFO, vol. 86(6), pages 509-521, June.
    16. Constantine, Collin, 2014. "Rethinking the Twin Deficits," MPRA Paper 58798, University Library of Munich, Germany.
    17. Karl Aiginger, 2014. "Industrial Policy for a Sustainable Growth Path," WIFO Working Papers 469, WIFO.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Andreas Reinstaller, 2014. "Technologiegeber Österreich. Österreichs Wettbewerbsfähigkeit in Schlüsseltechnologien und Enwicklungspotentiale als Technologiegeber," WIFO Studies, WIFO, number 47444, March.
    2. Andreas Reinstaller & Elisabeth Christen & Harald Oberhofer & Peter Reschenhofer, 2016. "Eine Analyse der Wettbewerbsfähigkeit Österreichs im bilateralen Handel mit den USA (TTIP)," WIFO Studies, WIFO, number 58723.
    3. repec:wsr:ecbook:2015:i:vi-004 is not listed on IDEAS
    4. Michael Klien & Michael Böheim & Matthias Firgo & Andreas Reinstaller & Peter Reschenhofer & Yvonne Wolfmayr, 2021. "Stärkung der Unabhängigkeit des Wirtschaftsstandortes Österreich bei kritischen Produkten," WIFO Studies, WIFO, number 67234, March.
    5. Alessia Lo Turco & Daniela Maggioni, 2016. "On firms’ product space evolution: the role of firm and local product relatedness," Journal of Economic Geography, Oxford University Press, vol. 16(5), pages 975-1006.
    6. Ben Saad, Myriam & Brahim, Mariem & Schaffar, Alexandra & Guesmi, Khaled & Ben Saad, Rym, 2023. "Economic complexity, diversification and economic development: The strategic factors," Research in International Business and Finance, Elsevier, vol. 64(C).
    7. Güzin Bayar, 2022. "Turkey's sectoral exports: A competitiveness approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(2), pages 2268-2289, April.
    8. Poncet, Sandra & Starosta de Waldemar, Felipe, 2013. "Export Upgrading and Growth: The Prerequisite of Domestic Embeddedness," World Development, Elsevier, vol. 51(C), pages 104-118.
    9. Hartmann, Dominik & Guevara, Miguel R. & Jara-Figueroa, Cristian & Aristarán, Manuel & Hidalgo, César A., 2017. "Linking Economic Complexity, Institutions, and Income Inequality," World Development, Elsevier, vol. 93(C), pages 75-93.
    10. Hidalgo, César A., 2023. "The policy implications of economic complexity," Research Policy, Elsevier, vol. 52(9).
    11. Sandra Poncet & Felipe Starosta, 2013. "Export upgrading and growth in China: the prerequisite of domestic embeddedness," PSE - G-MOND WORKING PAPERS halshs-00960684, HAL.
    12. Wonsub Eum & Jeong‐Dong Lee, 2022. "Alternative paths of diversification for developing countries," Review of Development Economics, Wiley Blackwell, vol. 26(4), pages 2336-2355, November.
    13. Koch, Philipp & Schwarzbauer, Wolfgang, 2021. "Yet another space: Why the Industry Space adds value to the understanding of structural change and economic development," Structural Change and Economic Dynamics, Elsevier, vol. 59(C), pages 198-213.
    14. Ferrarini, Benno & Scaramozzino, Pasquale, 2016. "Production complexity, adaptability and economic growth," Structural Change and Economic Dynamics, Elsevier, vol. 37(C), pages 52-61.
    15. repec:hal:pseose:halshs-00960684 is not listed on IDEAS
    16. Ricardo Hausmann & César Hidalgo, 2011. "The network structure of economic output," Journal of Economic Growth, Springer, vol. 16(4), pages 309-342, December.
    17. Benno Ferrarini & Pasquale Scaramozzino, 2015. "The Product Space Revisited: China's Trade Profile," The World Economy, Wiley Blackwell, vol. 38(9), pages 1368-1386, September.
    18. Ferrarini, Benno & Scaramozzino, Pasquale, 2013. "Complexity, Specialization, and Growth," ADB Economics Working Paper Series 344, Asian Development Bank.
    19. Cyrielle Gaglio, 2015. "Measuring Country Competitiveness: A Survey of Exporting-based Indexes," GREDEG Working Papers 2015-42, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    20. Alessia Lo Turco & Daniela Maggioni, 2017. "Local Discoveries and Technological Relatedness: the Role of Foreign Firms," Papers in Evolutionary Economic Geography (PEEG) 1710, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Jun 2017.
    21. Guzmán Ourens, 2012. "Can the Method of Re?ections help predict future growth?," Documentos de Trabajo (working papers) 1712, Department of Economics - dECON.
    22. Antonios Garas & Sophie Guthmuller & Athanasios Lapatinas, 2021. "The development of nations conditions the disease space," PLOS ONE, Public Library of Science, vol. 16(1), pages 1-35, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    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:wfo:wstudy:46823. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Florian Mayr (email available below). General contact details of provider: https://edirc.repec.org/data/wifooat.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.