Openness, Specialisation and Vulnerability of the Nordic Countries

Ville Kaitila and Tuomo Virkola

No 21, ETLA Reports from The Research Institute of the Finnish Economy

Abstract: Abstract In this paper we analyse to what extent the Nordic economies are vulnerable to external shocks. Specifically, we assess the conventional wisdom that the Nordic countries are small open economies that are significantly engaged in international trade, specialised in only few specific industries and, as a consequence, extremely dependent on the competiveness of their tradable sector and exposed to external shocks. To study this conventional wisdom, we employ a comprehensive set of indicators about trade openness, specialisation and vulnerability. While we do find that the Nordic countries are open economies, though not to an exceptional degree, we also find significant heterogeneity across these countries with respect to their vulnerability.

Keywords: International trade; Small open economy; Nordic countries; Specialisation; Vulnerability (search for similar items in EconPapers)
JEL-codes: F14 F6 L00 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2014-03-27
New Economics Papers: this item is included in nep-ger and nep-int
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