 The euro and firm restructuringMatteo Bugamelli, Fabiano Schivardi and Roberta Zizza No 10, Working Papers from Department of the Treasury, Ministry of the Economy and of Finance Abstract: We test whether and how the adoption of the euro, narrowly defined as the end of competitive devaluations, has affected member states� productive structures, distinguishing between within and across sector reallocation. We find evidence that the euro has been accompanied by a reallocation of activity within rather than across sectors. Shit its adoption. productivity growth has been relatively stronger in country-sectors that once relied more on competitive devaluations to regain price competitiveness. This effect is robust to potential omitted-variable bias and correlated effects. Firm-level ev�idence from Italian manifacturing confirms that low-tech businesses, which arguably benefitted most from devaluations, have been restructuring more since the adoption of the euro. Restructuring has entailed a shift of business focus from production to up�stream and downstream activities, such as product design, advertising, marketing and distribution, and a corresponding reduction in the share of blue collar workers. Keywords: euro; devaluations; productivity growth; firm restructuring; skill intensity (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:itt:wpaper:wp2009-10 Access Statistics for this paper More papers in Working Papers from Department of the Treasury, Ministry of the Economy and of Finance Contact information at EDIRC. |
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