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Reallocation of Resources between Tradable and Non-Tradable Sectors in Portugal: Developing a new Identification Strategy for the Tradable Sector

Author

Listed:
  • Ana Fontoura Gouveia

    (Gabinete de Planeamento, Estratégia, Avaliação e Relações Internacionais / Office for Economic Policy and International Affairs - Ministério das Finanças / Ministry of Finance)

  • Filipa Canas

Abstract

Portugal implemented a large number of structural reforms in the recent years, which are expected to enhance the allocation of resources in the economy, namely from the non-tradable to the tradable sector. We argue that the methodology to identify the tradable sector used by some international institutions is outdated and may hamper an accurate assessment of the structural progress achieved so far. Based on an enhanced methodology to identify the tradable sector of the economy, we provide more solid ground for future assessments of structural economic developments. By looking at some standard economic indicators, we show that our new criterion provides a different picture of the resource allocation in the Portuguese economy and of the adjustment of the recent years as compared to the one provided by commonly used criteria.

Suggested Citation

  • Ana Fontoura Gouveia & Filipa Canas, 2016. "Reallocation of Resources between Tradable and Non-Tradable Sectors in Portugal: Developing a new Identification Strategy for the Tradable Sector," GEE Papers 0060, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Feb 2016.
    • Handle: RePEc:mde:wpaper:0060
    as

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    File URL: https://www.gee.gov.pt/RePEc/WorkingPapers/GEE_PAPERS_60.pdf
    File Function: First version, 2016
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    References listed on IDEAS

    as
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    5. J. Bradford Jensen & Lori G. Kletzer, 2005. "Tradable Services: Understanding the Scope and Impact of Services Outsourcing," Working Paper Series WP05-9, Peterson Institute for International Economics.
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    8. Morris Goldstein & Lawrence H. Officer, 1979. "New Measures Of Prices And Productivity For Tradable And Nontradable Goods," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 25(4), pages 413-427, December.
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    10. Ricardo Reis, 2013. "The Portugese Slump and Crash and the Euro Crisis," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 44(1 (Spring), pages 143-210.
    11. Dwyer, Jacqueline, 1992. "The Tradeable Non-tradeable Dichotomy: A Practical Approach," Australian Economic Papers, Wiley Blackwell, vol. 31(59), pages 443-459, December.
    12. Mr. Thierry Tressel & Mr. Shengzu Wang, 2014. "Rebalancing in the Euro Area and Cyclicality of Current Account Adjustments," IMF Working Papers 2014/130, International Monetary Fund.
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    Cited by:

    1. Magalhaes, Manuela, 2020. "The impact of financial constraints on tradable and non-tradable R&D investments in Portugal," MPRA Paper 100348, University Library of Munich, Germany.
    2. Tiago Domingues & João Ferreira do Amaral & João Carlos Lopes, 2021. "Global value chains, value-added generation and structural change in EU core and periphery economies: An Input-Output approach," Working Papers REM 2021/0157, ISEG - Lisbon School of Economics and Management, REM, Universidade de Lisboa.

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    More about this item

    Keywords

    Allocative Efficiency; Trade; Microeconomic Policy;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • E - Macroeconomics and Monetary Economics
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation

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