Europe’s Trade Surplus, International Relative Prices, and the Productivity Growth Gap

Adrian Ifrim, Robert Kollmann (), Philipp Pfeiffer, Marco Ratto and Werner Roeger

No 2025-12, Working Papers ECARES from ULB -- Universite Libre de Bruxelles

Abstract: The Euro Area faces persistently weak productivity growth alongside a sustained trade surplus and a trendless real exchange rate. This column shows that persistent productivity growth differentials relative to the rest of the world, are a key driver of Europe’s external surplus. Structural trade shifts, such as declining home bias and falling import prices, have offset the appreciation pressures from the productivity-growth gap. Weak domestic investment is partly driven by global forces, highlighting the limits of purely demand-based explanations and associated policy prescriptions.

Keywords: European Union; trade surplus; real exchange rate; productivity growth. (search for similar items in EconPapers)
Date: 2025-09-04
New Economics Papers: this item is included in nep-eec
References: View complete reference list from CitEc
Citations:

Published by:

Downloads: (external link)
https://dipot.ulb.ac.be/dspace/bitstream/2013/3943 ... attoRoeger_VoxEU.pdf Œuvre complète ou partie de l'œuvre (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eca:wpaper:2013/394306

Ordering information: This working paper can be ordered from
http://hdl.handle.ne ... lb.ac.be:2013/394306

Access Statistics for this paper

More papers in Working Papers ECARES from ULB -- Universite Libre de Bruxelles Contact information at EDIRC.
Bibliographic data for series maintained by Benoit Pauwels ().