Sources of export growth and development of manufacturing industry: empirical evidence from Croatia

Abstract

The article quantifies the sources of manufacturing export growth in Croatia. The research objectives are achieved by applying the constant market share method (C.M.S.) and input–output model. While the C.M.S. method quantifies the factors which explain trends in manufacturing exports, the input–output method quantifies the impacts of manufacturing exports on other domestic sectors. The obtained results show that after the E.U. accession export performance of the Croatian manufacturing industry have substantially improved. The results indicate that a gain in competitiveness in the Croatian manufacturing industry was the most important factor which determined the increasing share of national companies in a period from 2013 to 2015. Besides the manufacturing industry, export growth indirectly contributes to better performance of all domestic producers included in the value added chain of exporters. Indirect effects are the most pronounced for agriculture, trade, transport and business services.