Factory Europe? Brainier but Not Brawnier
While intermediates comprise the majority of total goods trade in the European Union (EU), their share of total trade has remained flat since 1996. This implies that EU enlargement has had a limited effect on the size of Factory Europe. However, en...
| Main Authors: | , |
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| Format: | Background Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2016/04/26228477/factory-europe-brainier-not-brawnier http://hdl.handle.net/10986/24495 |
| Summary: | While intermediates comprise the
majority of total goods trade in the European Union (EU),
their share of total trade has remained flat since 1996.
This implies that EU enlargement has had a limited effect on
the size of Factory Europe. However, enlargement coincides
with an increase in Factory Europe’s complexity. Using two
new measures of the complexity of intermediates products, we
show that internal EU intermediates trade has become more
sophisticated and uses more relationship-specific inputs
over time and relative to external EU trade. In other words,
Factory Europe has become brainier but not necessarily
brawnier. There is also an asymmetry. While the 1995 EU
members have not become more significant trading partners
for the new members, the new members have become a more
important source of intermediates for the EU15 and also a
more important market. In sum, the structure of EU trade has
changed--not only is the EU15 giving the new members a
bigger share of its tasks, it is also giving them harder ones. |
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