Disembedded Openness: Inequalities in European Economic Integration at the Sectoral Level


The process of European integration resulted in a marked increase in transnational economic flows, yet regional inequalities along many developmental indicators remain. We analyze the unevenness of European economies with respect to the embedding of export sectors in upstream domestic flows and their dependency on dominant export partners. We use the WIOD dataset of sectoral flows for the period of 1995–2011 for 24 European countries. We found that East European economies were significantly more likely to experience increasing unevenness and dependency with increasing openness, while core countries of Europe managed to decrease their unevenness but increased their openness. Nevertheless, by analyzing the trajectories of changes for each country, we see that East European countries are also experiencing a turning point, either switching to a path similar to the core or to a retrograde path with decreasing openness. We analyze our data using pooled time series models and case studies of country trajectories.

This is a preview of subscription content, log in to check access.

Fig. 1
Fig. 2
Fig. 3
Fig. 4
Fig. 5
Fig. 6
Fig. 7
Fig. 8
Fig. 9
Fig. 10
Fig. 11
Fig. 12
Fig. 13
Fig. 14
Fig. 15


  1. 1.

    Although there is an overall agreement of the trade-creating effects of economic integration, particularly with respect to the European case (e.g., Bergstrand 2008), conceptualizing and measuring such an effect is not a trivial exercise. Whether comparing intra- and extra-area trade or extrapolated pre-integration data with actual post-integration observations, such ex-post assessments, similar to pre-integration assessments of would-be effects, are inherently difficult (Balassa 1967).

  2. 2.

    Whereas “economic integration” typically refers to the institutional and regulatory processes towards (and state of) the creation of a common market (e.g., Balassa 1962), our usage of the term refers explicitly to cross-border economic exchange.

  3. 3.

    WIOD uses a sectoral nomenclature comprising 35 sectors, but as there are no data on intermediate flows for the “private households with employed persons” sector, this sector is excluded in our analyses.

  4. 4.

    The magnitude of intra-sectoral flows might be influenced strongly by concentration of firm sizes. If a sector is represented by few or only one large firm, intra-firm flows might not get reported to statistical agencies.

  5. 5.

    Similar to the openness index and based on the same reasons, we have chosen to exclude the intra-sectoral flows in the diagonal of the input-output tables.

  6. 6.

    A corresponding index for downstream domestic embeddedness is conceivable, i.e., where a sector’s share of domestic inter-sectoral output is contrasted with its share of imports. In agreement with the contemporary literature on international political economy, testing such a corresponding downstream index in our analysis, we found find that the most interesting findings stemmed from looking at exports vis-à-vis domestic inputs, i.e., reflecting where most of the contemporary literature on international political economy and world-system analysis puts its focus.

  7. 7.

    Although a benchmark approach could be used here, i.e., determining an average sectoral domestic/foreign ratio using all countries and years and subsequently adjusting the UDE metric to this benchmark, we preferred allowing for these inherent sectoral properties to shine through in our results, especially as our interest lies in longitudinal change.

  8. 8.

    Permutations tests for the p values of coefficients are especially appropriate since the observations are not drawn as a sample from a large population, but represent all cases (all the country years in the period we consider) (Good 2006).


  1. Appelbaum RP, Smith D, Christerson B. Commodity chains and industrial restructuring in the Pacific Rim: garment trade and manufacturing. In: Gereffi G, Korzeniewicz M, editors. Commodity Chains and Global Capitalism. Westport: Praeger Publishers; 1994.

    Google Scholar 

  2. Balassa B. The theory of economic integration. London: Routledge; 1962.

    Google Scholar 

  3. Balassa B. Trade creation and trade diversion in the European common market. Econ J. 1967;77(305):1–21.

    Article  Google Scholar 

  4. Bauer PT. West African trade: a study of competition, oligopoly and monopoly in a changing economy: University Press; 1954.

  5. Bergstrand JH. 2008. How much has European economic integration actually increased members’ trade? Centre for Economic Policy Research, available at http://www.voxeu.org/article/european-economic-integration-and-trade-how-big-was-boost (27 November 2015).

  6. Berman BJ. Clientelism and neocolonialism: center-periphery relations and political development in African states. Stud Comp Int Dev. 1974;9(2):3–25.

    Article  Google Scholar 

  7. Bohle D, Greskovits B. Capitalist diversity on Europe’s periphery. New York: Cornell University Press; 2012.

    Google Scholar 

  8. Böwer U, MIchou V, Ungerer C. The puzzle of the missing Greek exports. In: Economic papers 518. Brussels: Directorate-General for Economic and Financial Affairs; 2014.

    Google Scholar 

  9. Bruszt L, Langbein J, Vukov V, Bayram E, Markiewicz O. The developmental impact of the EU integration regime: insights from the automotive industry in Europe’s peripheries. MAXCAP Working Paper Series no. 16. 2015.

  10. Chan S. Cores and peripheries interaction patterns in Asia. Comp Pol Stud. 1982;15(3):314–40.

    Article  Google Scholar 

  11. Condliffe JB. The commerce of nations: Norton; 1950.

  12. Dietzenbacher E, Los B, Stehrer R, Timmer M, de Vries GJ. The construction of world input-output tables in the WIOD project. Econ Syst Res. 2013;25(1):71–98.

    Article  Google Scholar 

  13. Dominguez JI. Mice that do not roar: some aspects of international politics in the peripheries. Int Organ. 1971;25(2):175–208.

    Google Scholar 

  14. Galtung J. A structural theory of imperialism. J Peace Res. 1971;8(2):81–117.

    Article  Google Scholar 

  15. Gereffi G, Korzeniewicz M, editors. Commodity chains and global capitalism. Westport: Praeger Publishers; 1994.

    Google Scholar 

  16. Good PI. Resampling methods: a practical guide to data analysis. Third edition. Boston: Birkhäuser; 2006.

    Google Scholar 

  17. Greskovits B. Leading sectors and the variety of capitalism in Eastern Europe. Actes du GERPISA. 2005;39:113–28.

    Google Scholar 

  18. Hardy J. Cathedrals in the desert? Transnationals, corporate strategy and locality in Wroclaw. Reg Stud. 1998;32(7):639–52.

    Article  Google Scholar 

  19. Heintz J. Low-wage manufacturing and global commodity chains: a model in the unequal exchange tradition. Camb J Econ. 2006;30:507–20.

    Article  Google Scholar 

  20. Hoen AR. An input-output analysis of European integration. Amsterdam: Elsevier; 2002.

    Google Scholar 

  21. Kirby P. Celtic Tiger in collapse: explaining the weaknesses of the Irish model. New York: Palgrave MacMillan; 2010.

    Google Scholar 

  22. Kirby P, Carmody P. The legacy of Ireland’s economic expansion: geographies of the Celtic Tiger. New York: Routledge; 2010.

    Google Scholar 

  23. Krugman P. Geography and trade. Cambridge: MIT Press; 1991.

    Google Scholar 

  24. Maya-Ambía J., C. 2011. Constructing agro-industrial clusters or disembedding of the territory? Lessons from Sinaloa as the leading horticultural export-oriented region of Mexico. Open Geogr J, 4:29–44.

  25. Meier GM, Baldwin RE. Economic development: theory, history, policy: John Wiley & Sons; 1957.

  26. Nordlund C. Social ecography: international trade, network analysis, and an Emmanuelian conceptualization of ecological unequal exchange. Lund: Lund university; 2010.

  27. Oman CP, Wignaraja G. The postwar evolution of development thinking. Houndmills & London: Macmillan, St. Martin’s & OECD Development Centre; 1991.

    Google Scholar 

  28. Porter ME. Competitive advantage: creating and sustaining superior performance. New York: Free press; 1985.

    Google Scholar 

  29. Singer HW. Dualism revisited: a new approach to the problems of the dual society in developing countries. J Dev Stud. 1970;17(1):60–75.

    Article  Google Scholar 

  30. So AY. Social change and development: modernization, dependency and world-system theories. California: Sage publications; 1990.

    Google Scholar 

  31. Timmer M (ed). 2012. The world input-output database (WIOD): contents, sources and methods. Available at: http://www.wiod.org/publications/source_docs/WIOD_sources.pdf

  32. Timmer MP, Dietzenbacher E, Los B, Stehrer R, de Vries GJ. An illustrated user guide to the world input-output database: the case of global automotive production. Rev Int Econ. 2015;23:575–605.

    Article  Google Scholar 

  33. Wallerstein I, Hopkins T. Commodity chains in the world prior to 1800. In: Wallerstein I, editor. The Essential Wallerstein. New York: New Press; 2000 [1986]. [Orig. publ. in Review, 1986, 10: 157–170].

  34. Yanikkaya H. Trade openness and economic growth: a cross-country empirical investigation. J Dev Econ. 2003;72:57–89.

    Article  Google Scholar 

Download references

Author information



Corresponding author

Correspondence to Balazs Vedres.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Vedres, B., Nordlund, C. Disembedded Openness: Inequalities in European Economic Integration at the Sectoral Level. St Comp Int Dev 53, 169–195 (2018). https://doi.org/10.1007/s12116-018-9263-4

Download citation


  • Economic integration
  • Network science
  • Political economy
  • World system