Rethinking Regional Competitiveness: Catalonia's International and Interregional Trade 1995-2006

30 Pages Posted: 6 Oct 2009 Last revised: 12 Sep 2010

See all articles by Pankaj Ghemawat

Pankaj Ghemawat

University of Navarra, IESE Business School; New York University (NYU) - Leonard N. Stern School of Business

Carlos Llano

Universidad Autónoma de Madrid

Francisco Requena

University of Valencia - Department of Applied Economics II

Date Written: July 1, 2009

Abstract

Studies of competitiveness tend to focus on a local economy's global interactions, particularly its international trade. But for countries that are at least mid-sized (such as Spain), interregional trade tends to be as large as or significantly larger than international trade. The case of Catalonia illustrates the importance of interregional flows in truly analyzing and devising strategies for a region's external competitiveness. Accounting for interregional trade changes and performing analyses of Catalonia's overall merchandise trade balance, which sectors generate external surpluses as opposed to deficits, and who Catalonia's key trading partners are, and the use of a gravity-model approach to estimate external border effects at the regional level for Catalonia and the rest of Spain, reveal significant variations by sector and by trading partner, generally higher external border effects for exports than imports, and declines in border effects over time - but with a discernible flattening in recent years.

Keywords: Border Effect, Gravity Model, Interregional Trade, Transport Flow

JEL Classification: F14, F17, F21, L14

Suggested Citation

Ghemawat, Pankaj and Llano, Carlos and Requena Silvente, Francisco, Rethinking Regional Competitiveness: Catalonia's International and Interregional Trade 1995-2006 (July 1, 2009). IESE Business School Working Paper No. 802. Available at SSRN: https://ssrn.com/abstract=1482986 or http://dx.doi.org/10.2139/ssrn.1482986

Pankaj Ghemawat (Contact Author)

University of Navarra, IESE Business School ( email )

Avenida Pearson 21
Barcelona, 08034
Spain

New York University (NYU) - Leonard N. Stern School of Business ( email )

Suite 9-160
New York, NY
United States

Carlos Llano

Universidad Autónoma de Madrid ( email )

Facultad de Ciencias Económicas y Empresariales
Departamento de Análisis Económico
Madrid, Madrid 28049
Spain
+34 914972910 (Phone)

Francisco Requena Silvente

University of Valencia - Department of Applied Economics II ( email )

Edifici Departamental Oriental
Avda. dels Tarongers, S/N
46022 Valencia
Spain
+34 963 828 353 (Phone)
+34 96 3828 354 (Fax)

HOME PAGE: http://www.uv.es/frequena/

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