Quality-adjusted similarity of EU-countriesŽ export structure

Ville Kaitila

No 1227, Discussion Papers from The Research Institute of the Finnish Economy

Abstract: We propose a new way to measure the extent to which countries compete in their exports. We augment the similarity index proposed by Finger and Kreinin (1979) with product quality. Quality is measured using unit export prices in the tradition of the horizontal/vertical intra-industry trade literature. We analyse the EU27 countries export structures using 1) overall similarity à la Finger and Kreinin, 2) same-quality similarity, and 3) quality-adjusted similarity that combines the first two measures. We find that the similarity of the export structures of the new member countries and the cohesion countries vis-à-vis the non-cohesion EU15 countries has increased, but that there remains a divide between them especially in terms of same-quality exports.

Keywords: exports; similarity; quality (search for similar items in EconPapers)
JEL-codes: F14 F15 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2010-01-01
New Economics Papers: this item is included in nep-eec, nep-eur and nep-int
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Citations: View citations in EconPapers (2)

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