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Economic growth, structural change and quality upgrading in New Member States

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  • Aleksandra PARTEKA

Abstract

The purpose of this research is to present the recent developments concerning structural change and productivity growth in New Member States and the role played in such process by country specific factors. We focus on ten countries (NMS-10) which joined the EU in 2004 and analyze productivity dynamics of their labor structures between the years 1995 and 2005 in a comparative setting versus EU-15 economies. NMS-10 have gone through a rapid process of economic restructuring and its speed has been positively related to the economic development. However, shift-share analysis of productivity growth indicates that changes in value added per hour worked were due mainly to positive developments (rising productivity) within single sectors and only to a lower extent to the shift towards higher productivity sectors. The process of a structural change and productivity growth has been characterized by beta convergence type mechanism, with public spending (especially on education, social protection, public order and safety) and trade (in particular with more advanced EU-15 countries) promoting overall and intra-industry productivity upgrading.

Suggested Citation

  • Aleksandra PARTEKA, 2009. "Economic growth, structural change and quality upgrading in New Member States," Departmental Working Papers 2009-027, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    • Handle: RePEc:mil:wpdepa:2009-027
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    More about this item

    Keywords

    Structural change; productivity; public spending; trade;
    All these keywords.

    JEL classification:

    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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