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Empirical Economics

, Volume 51, Issue 2, pp 707–735 | Cite as

Non-price competitiveness of exports from emerging countries

  • Konstantins Benkovskis
  • Julia Wörz
Article

Abstract

We construct a relative export price index that adjusts for changes in non-price factors (e.g. quality or taste) and changes in the set of competitors for nine emerging economies (Argentina, Brazil, Chile, China, India, Indonesia, Mexico, Russia and Turkey). The index is calculated using highly disaggregated (6-digit Harmonized System, HS) trade data from UN Comtrade for the period between 1996 and 2012. Our method highlights the crucial importance of non-price competitiveness in assessing emerging countries’ performance on external markets, as well as notable differences in non-price competitiveness dynamics across exporters. China shows a huge gain in international competitiveness due to non-price factors, while the role of the exchange rate in explaining China’s competitive position may have been overstressed. Similarly, Brazil, India and Turkey show discernible improvements in their competitive position when accounting for non-price factors. Oil exports account for strong improvement in Russia’s non-price competitiveness, as well as losses of competitiveness for Indonesia. Mexico’s competitiveness deteriorates prior to 2006 and improves afterwards.

Keywords

Non-price competitiveness Quality Relative export price Emerging countries 

JEL Classification

C43 F12 F14 L15 

Notes

Acknowledgments

The authors wish to thank anonymous referees, Rudolfs Bems, Chiara Osbat, Tairi Rõõm, and seminar participants at the 10th Emerging Markets Workshop (Oesterreichische Nationalbank), European Trade Study Group 2012 annual conference and EACES Workshop in Tartu for useful comments and suggestions.

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Copyright information

© Springer-Verlag Berlin Heidelberg 2015

Authors and Affiliations

  1. 1.Kr. Valdemara iela 2ARigaLatvia
  2. 2.Foreign Research DivisionOesterreichische NationalbankViennaAustria

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