Development of productive structures of EU Member Countries and their international competitiveness

23  January 2014    4:00 pm

Andreas Reinstaller, WIFO


wiiw, Rahlgasse 3, 1060 Vienna, lecture hall (entrance from the ground floor)


The study has examined the development of the productive structures of the EU and its Member States by drawing on recent developments in the analysis of economic complexity and international trade patterns. The analysis of these networks reveals unobserved information on the capabilities of countries, the characteristics of products and the structure of the economies. From this information it is possible to construct outcome based indicators on structural change, competitiveness and the growth potential of countries that do not rely on aggregate economic data and indicators that are often strongly correlated with their GDP. Product space measures are also very useful for policy making as they are strong predictors for potential success in international trade. The assessment of Europe’s economies shows that there is a considerable dispersion in the complexity score indicator across Member States. The opportunities for upgrading productive structures are found to be distributed very unevenly across countries and sectors. These disparities typically increase as one gets to the regional level. It may be necessary that in regions with little opportunity for upgrading smart specialisation is complemented by other structural policies to avoid that they do get trapped in inferior productive structures. The paper was written in cooperation with with Werner Hölzl, Johannes Kutsam and Christian Schmid.

This seminar series is an activity in the framework of FIW ('Forschungsschwerpunkt Internationale Wirtschaft'), which is a project designed to build a center of excellence in research on International Economics, funded by the Austrian Ministry of Economics, Family and Youth.

Keywords: FDI Diversification, Capabilities, Economic complexity, Structural transformation. The product space, development trajectories

JEL classification: O11, O14, O33, O57, F43