INTENSITY AND STRUCTURE OF INTRA-INDUSTRY TRADE IN AGRI-FOOD PRODUCTS OBSERVED IN POLISH AND EU FOREIGN TRADE WITH THE US

Abstract

The aim of this paper was to investigate the intensity and determine the type of intra-industry trade in agri-food products of Poland and the EU with the US. Analysis was based on data coming from the Comext-Eurostat database applying the 6-digit HS classification in 2007 and 2018. The intensity of intra-industry trade was established using the Grubel-Lloyd index, taking the diversification of intra-industry trade into horizontal, high-quality vertical, and low-quality vertical trade into consideration. The individual types were determined applying the criteria of similarity in unit values in exports and imports, proposed by David Greenaway et al. [1994]. Analysis showed that trade in agri-food products of Poland and the EU with the US developed mainly following a model of inter-industry specialisation. Intra-industry trade was observed primarily in trade in highly processed products. Analyses of EU trade with the US indicate the greatest role of intra-industry trade in high quality differentiated products, which may hardly be supplemented by other goods, while in Polish trade with the US it was vertical trade in low quality goods, which may be relatively readily replaced by products coming from other countries, in turn potentially leading to the loss of Poland’s share in the target market.

Keywords

• intra-industry trade
• horizontal intra-industry trade
• vertical intra-industry trade
• agri-food products
• Poland
• the EU