Estimation of NEE low-tech export impact to Lithuanian low-tech export growth

Jūratė Pridotkienė, Daiva Laskiene, Vitalija Venckuviene

Abstract


Estimation of NEE low-tech export impact to Lithuanian low-tech export growth

Jurate Pridotkienea, Daiva Laskieneb, Vitalija Venckuvienec

a, b Kaunas University of Technology, K.Donelaicio 20, LT 44249 Kaunas, Lithuania

 

 

In recent decades most of advanced economies suffered enhanced competitive pressure from newly emerging economies. Especially it concerns low-tech sector, where the direction of international labour divisions has changed because of increasing globalization processes. Eventually newly emerging economies became the drivers for the global economic growth. The most important NEEs globally are China, Argentina, Brazil, India, Indonesia, South Africa, while Russian Federation influence decreased substantially. Developing economies beyond the BRICS, such as Viet Nam, Bangladesh, Pakistan, Turkey Mexico and others compete with each other and with BRICS in the field of FDI inflow attraction and manufacture development, at the same time gaining even greater pace of industrial development and weight in global competition.

Purpose. The main purpose of the research is to estimate to what extent low-tech export of newly emerging economies (NEE) to the main Lithuanian low-tech export destination markets (mainly EU) has direct impact to the growth of Lithuanian low-tech export.

Methodology. The impact is assessed by performing correlation-regression analysis of Lithuanian low-tech export data and NEE export of the same products to the same export markets, which are mainly the EU-15 markets.

Research data was extracted from UN Comtrade annual data basis for the period of 2000- 2012. Commodities of low-tech sector were selected by SITS Rev.2 classification in 2-digit level. Reporting countries were selected as those which are the main export markets for Lithuanian low-tech. Partner countries were selected on the basis of the most extensive import sources for the main Lithuanian low-tech export destination countries (the main competitors for Lithuanian exporters).

Correlation and multiple regression, which is an extension of simple linear regression, was employed in the research. This method is used in order to predict the Lithuanian export growth to the European countries based on the value of NEE export growth variables. Before the regression analysis all indicators were included in the descriptive statistics analysis.

Results. The correlation-regression analysis of Lithuanian and NEE low-tech exports to the same European markets showed that there is no essential causal relationship between Lithuanian low-tech sector exports and NEE exports. Therefore other variables to the growth of Lithuanian exports to EU markets should be explored.

The theoretical contribution. The research results give a basis to search for different type of relations for Lithuanian-NEE export competition.

Practical implications (if applicable). The results may be useful for export promotion policy makers.

Keywords: low-tech industry, newly emerging economies, regression analysis.

Paper type: Research paper.


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