The Propagation of Worldwide Sector-Specific Shocks

Izquierdo, Mario; Moral‐Benito, Enrique; Prades, Elvira; Quintana, Javier

doi:10.2139/ssrn.4068780

Cited by 2 publications

(2 citation statements)

References 7 publications

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“…given the unemployment rate for low-skilled workers is four times larger than that of highskilled workers, we assume that the labor elasticity for low-skilled workers is also four times But also because in this case it reproduces the positive effect of the input-output matrices shown in Figure 2, but in this case at the cross-border level. These sectors have production chains that are particularly integrated at the European level, so that when their counterparts in other countries receive capital transfers, they take advantage of the significant benefit from the improved productivity of their suppliers of intermediate inputs (Izquierdo et al (2022)).…”

Section: Labor Networkmentioning

confidence: 99%

A production network model for the Spanish economy with an application to the impact of NGEU funds

Fernández-Cerezo

Moral‐Benito

Quintana

2023

Documentos De Trabajo

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This paper introduces a sectoral model for the Spanish economy that allows a better understanding of the propagation of sector-specific shocks taking into account different network interdependencies. In particular, the model features sector interactions along several dimensions in an open economy setting, either in the provision of intermediate inputs and capital goods or competing in the labour market. This framework is flexible enough to provide insights into the effect of several policy-relevant shocks, such as global value chain bottlenecks, increases in production costs in energy-intensive sectors or large public investment programmes. In order to illustrate the role of such sectoral interactions, we consider a sectorisation of Next Generation EU (NGEU) funds based on Spain’s Recovery, Transformation and Resilience Plan (RTRP) which will mobilize €69.5 bn in grants. According to our findings, the average impact over a 5-year horizon is 1.15% of GDP if we consider only the direct effect of the investment programmes and expenditure plans, but it increases to 1.75% if we take into account the increase in the productive capacity of certain sectors and its propagation through the production network. Moreover, the resulting expansion is particularly strong in sectors highly dependent on high-skilled labour, such as IT and professional services, which might lead to shortages of high-skilled workers, reducing the aggregate impact on GDP by 25%.

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Section: Labor Networkmentioning

confidence: 99%

A production network model for the Spanish economy with an application to the impact of NGEU funds

Fernández-Cerezo

Moral‐Benito

Quintana

2023

Documentos De Trabajo

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“…In order to quantify the possible effects of the implementation of the EU digitalisation strategy, we ran simulations employing the general equilibrium production network model developed by Izquierdo et al (2022). The calibration of this model relies mainly on Inter-Country Input-Output tables and literature estimates.…”

Section: Box 11mentioning

confidence: 99%

Contribución de la UE a la reglobalización: de la búsqueda de la autonomía a la estrategia de seguridad económica

Burguete

2023

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La propuesta de una «Estrategia Europea de Seguridad Económica» supera el marco general de las dependencias estratégicas de la Unión Europea (UE) para centrarse en la competición con China. Este nuevo marco de competición, más cercano al posicionamiento de Estados Unidos, puede fácilmente conducir al proteccionismo, el desacople económico y la desglobalización, un escenario contrario a los intereses de la UE, tanto por su impacto económico en términos de crecimiento e inflación, como por sus consecuencias para la gobernanza global. Aunque la UE debe tener herramientas para adaptarse al nuevo entorno internacional, la mejor manera de mejorar su autonomía y seguridad económica es a través de la profundización de su integración, el impulso de su competitividad y la diversificación de su comercio. La Declaración de Granada del Consejo Europeo del 6 de octubre de 2023 es un paso para redefinir de manera positiva los cambios en las reglas de la globalización.

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The Propagation of Worldwide Sector-Specific Shocks

Cited by 2 publications

References 7 publications

A production network model for the Spanish economy with an application to the impact of NGEU funds

A production network model for the Spanish economy with an application to the impact of NGEU funds

Contribución de la UE a la reglobalización: de la búsqueda de la autonomía a la estrategia de seguridad económica

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