Anatomy of Austria’s trade in services

Patricia Walter

Monetary Policy & the Economy, 2017, issue 1, 33-52

Abstract: This study analyzes Austrian exports of business services as an indicator of non-price competitiveness in manufacturing before and after world trade collapsed in 2008/09. A unique company dataset was used for this purpose and broken down into individual product/market combinations. The trend analysis differentiates between export growth along the intensive margin (intensifying existing export relations) and along the extensive margin (establishing new export relations). The extensive margin, which signifies export diversification, is more important for the development of manufacturers’ service exports than that of the service sector. This applies in particular to manufacturers that are more technology intensive and it implies that Austrian manufacturers develop know-how to establish new foreign trade relations. After the global trade meltdown, however, manufacturers’ service exports seemed to have primarily helped maintain long-term trade relations, with the extensive margin losing significance. This indicates a worsening of the framework conditions (heightened protectionism) and weak development of foreign trade in goods having a negative impact on service exports.

Keywords: Competitiveness; diversification; industry studies; international trade; services; specialization (search for similar items in EconPapers)
JEL-codes: F14 L25 L60 L80 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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