European enlargement policy, technological capabilities and sectoral export dynamics

This paper examines how the last wave of the European Union (EU) enlargement process has influenced the export competitiveness of EU countries. A technology-augmented gravity model is applied to distinguished manufacturing sectors to test the effect of the economic integration as well as the role of technological capabilities on export dynamics in old and new EU countries. The main findings reveal that the enlargement process has produced an overall larger positive impact on export flows for new members and that this positive effect appears not to be confined to low-tech sectors. This result suggests that the EU enlargement has favoured a process of trade embodied and disembodied technology transfer between member states. Hence, the evidence provided in this analysis contrasts with the view that the enlargement process led to increasing specialization of new member states in sectors characterized by lower technological content. In addition, the study shows that the level of technological capabilities is a crucial driving factor for export dynamics, both for old and new EU countries, and that the interrelations between the European enlargement process and the level of technological capabilities are relevant. Copyright Springer Science+Business Media New York 2015