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Technological catching up, quality of exports and competitiveness: a sectoral perspective

Author

Listed:
  • Eleonora Cavallaro
  • Piero Esposito
  • Alessia Matano
  • Marcella Mulino

Abstract

In the paper we focus on emerging market economies' pattern of trade, with a view to explaining the different features of competitiveness for high skill- and low skill-intensive firms. We consider a theoretical dynamical setup where high-skill firms engage in innovation activity and gain market shares in high-income "quality dominated" markets thanks to technological catching up, whereas low-skill firms face price competition for their exports. On the basis of the theoretical model, we run econometric estimations for trade between CEECs and EU economies over the period 2000-2007. In the econometric analysis we first test the assumption that UVR is an adequate indicator of quality in trade, showing that in high skill-intensive firms it is systematically correlated to domestic and foreign technological variables; we then use the fitted UVR in the estimation of the role of preference for quality in the evolution of CEECs' market shares. The estimations support the results of the theoretical model as to the role of non-price competitiveness stemming from quality-supply as well as quality-demand factors.

Suggested Citation

  • Eleonora Cavallaro & Piero Esposito & Alessia Matano & Marcella Mulino, 2012. "Technological catching up, quality of exports and competitiveness: a sectoral perspective," Working Papers in Public Economics 158, Department of Economics and Law, Sapienza University of Roma.
    • Handle: RePEc:sap:wpaper:wp158
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    References listed on IDEAS

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    Cited by:

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    3. Arta MULLIQI, 2021. "The role of education in explaining technology-intensive exports: a comparative analysis of transition and non-transition economies," Eastern Journal of European Studies, Centre for European Studies, Alexandru Ioan Cuza University, vol. 12, pages 141-172, June.
    4. Cavallaro, Eleonora & Cutrini, Eleonora, 2019. "Distance and beyond: What drives financial flows to emerging economies?," Economic Modelling, Elsevier, vol. 81(C), pages 533-550.

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    More about this item

    Keywords

    Vertical innovation; Knowledge spillovers; Product quality; International competitiveness.;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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