Original scientific paper
https://doi.org/10.1080/1331677X.2018.1438910
What drives the differences in domestic value added in exports between old and new E.U. member states?
Nataša Vrh
; Faculty of Economics, University of Ljubljana, Ljubljana, Slovenia
Abstract
Domestic value added in exports has lately become a key measure of
a country’s global competitiveness. This paper analyses the potential
drivers of the differences in domestically generated value added in
exported goods between ‘new’ (CEE-10) and ‘old’ (EU-15) countries.
The analysis focuses on the role played by intangible investments,
human capital and foreign direct investment. By studying export
performance at the industry level for the period 2000–2011, this
paper finds that differences in the share of domestically generated
value added depend on investments in intangible capital, in particular
investments in research and development. CEE-10 countries suffer
from a distinct lack of investments in intangible capital, which is
currently only sufficient to enable their mere participation in global
value chains. Further, inward F.D.I. causes a reduction in demand for
domestic inputs for both groups of countries and hence lowers D.V.A.
in exports, while CEE-10 countries are also found to be upgrading
global value chains by undertaking outward F.D.I.
Keywords
Global value chains; value-added in exports; international trade; G.V.C. upgrading; intangible assets
Hrčak ID:
200696
URI
Publication date:
3.12.2018.
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