Can value chain integration explain the diverging economic performance within the EU?

Andreas Reinstaller (), Agnes Kügler and Klaus Friesenbichler

No 123, Research Papers from Büro des Produktivitätsrates

Abstract: This paper studies the interplay of integration into EU value chains and industrial development measured by labour productivity. Our integration indicator measures value chain trade within the Single Market relative to global value chain networks. Using a simultaneous equation model, we find an overall positive effect of integration on labour productivity, which is driven by upstream integration. Highly productive industries rather seek global value chain trade than regional integration, though. Better domestic institutions facilitate EU integration, although they favour industries with less complex product portfolios and lower levels of knowledge cumulativeness.

Keywords: EU integration; value chains; productivity; institutions; industrial development; product complexity (search for similar items in EconPapers)
JEL-codes: F13 F14 O25 O43 O52 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2022-06
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Published in Economia e Politica Industriale: Journal of Industrial and Business Economics, March 2023, vol. 50(1), pages 25-47

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Related works:
Journal Article: Can value chain integration explain the diverging economic performance within the EU? (2023)
Working Paper: Can Value Chain Integration Explain the Diverging Economic Performance within the EU? (2022)
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