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The Structure of EU-CEE Intra-Industry Trade

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  • Thom, R.

Abstract

This paper presents an analysis of the growth and structure of EU-CEE intra-industry trade since the latter commenced their economic transition in the late 1980's. Section 2 outlines the economic rationale for intra-industry trade and its classification into horizontal and vertical two-way trade. Section 3 discusses the empirical classification of trade flows. Rather than relying on the conventional Grubel-Lloyd index as an indicator of intra-industry trade the analysis uses a decomposition due to Fontagne and Freudenberg (1997a, 1997b) which provides consistency between theory and measurement. Section 4 uses this technique to decompose EU-CEE trade flows over 1990 to 1995. Dection 6 addresses the issue of adjustment costs by distinguishing between static and dynamic, or marginal, trade flows.

Suggested Citation

  • Thom, R., 1999. "The Structure of EU-CEE Intra-Industry Trade," Papers 99/1, College Dublin, Department of Political Economy-.
  • Handle: RePEc:fth:dublec:99/1
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    Citations

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    Cited by:

    1. Hubert Gabrisch & Maria Luigia Segnana, 2002. "Why is trade between the European Union and the transition economies vertical?," Department of Economics Working Papers 0207, Department of Economics, University of Trento, Italia.
    2. Maria Segana & Hubert Gabrisch, 2002. "Intra-industry Trade between European Union and Transition Economies: Does Income Distribution Matter?," LIS Working papers 297, LIS Cross-National Data Center in Luxembourg.

    More about this item

    Keywords

    TRADE ; MONETARY UNION ; ECONOMIC INTEGRATION ; INDUSTRIAL DEVELOPMENT;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • F10 - International Economics - - Trade - - - General
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System

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