Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5056678 | Economic Systems | 2008 | 16 Pages |
Abstract
This paper analyses the Balassa and Samuelson hypothesis in two groups of countries: six new member states (NMSs) of the EU and six old member states (OMSs) not affected by the transition problems. We find that in the NMS group, the model may be successfully enlarged with variables that account for both quality improvements in the tradable sector and increases in the demand for domestic tradable goods. In the OMS panel, the model fails because national markets of tradable goods remain segmented, probably due to political interests, imperfect competition and transportation costs.
Keywords
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Social Sciences and Humanities
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Economics and Econometrics
Authors
José GarcÃa-Solanes, F. Israel Sancho-Portero, Fernando Torrejón-Flores,