The Motor Vehicles Industry in Slovakia, 2005 – 2015

Biswajit Banerjee () and Juraj Zeman
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Biswajit Banerjee: National Bank of Slovakia and Ashoka University, Sonepa and Research and Information System (RIS) for Developing Countries
Juraj Zeman: National Bank of Slovakia, Research Department

Journal of Economics / Ekonomicky casopis, 2022, vol. 70, issue 4, 307-332

Abstract: This paper examines the evolution of the Slovak motor vehicles sector during 2005 – 2015, drawing on the latest update (December 2018) of OECD’s Inter-Country Input-Output (ICIO) model database. The review takes a global value chain (GVC) approach and looks at the linkages from the gross production and value-added perspectives. The overall contribution of the motor vehicles sector to Slovakia’s gross production and domestic value added increased twofold during the reference period. There was an ongoing change in the structure of the GVC linkages. The reliance on domestically-sourced inputs increased over the years. The (indirect) value added created in the production of domestically-sourced inputs gradually approached the level of the (direct) value added generated within the motor vehicles sector. Subsequent to the global financial crisis, the share of intermediate goods in exports, the forward linkage of the GVC, and the upstreamness of the production process were all on a rising trend. The sourcing pattern of imports of intermediate inputs and the market for exports steadily shifted away from the euro area towards non-EU countries. It is estimated that a hypothetical 10 percent negative shock to global final demand for motor vehicles would lower Slovak GDP growth by 1 percentage point.

Keywords: backward linkage; forward linkage; GVC participation rate; length of GVC; position in GVC (search for similar items in EconPapers)
JEL-codes: D57 F14 F23 L62 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:sav:journl:v:70:y:2022:i:4:p:307-332

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