Horizontal and Vertical Intra-Industry Trade between the Former CEFTA Countries and the European Union

This paper analyses the production structure or intra-industry trade specialization (IIT) of the Czech Republic, Hungary, Poland, Slovenia and Slovakia in foreign trade with EU member states from 1995 to 2001 at the five-digit level of the SITC. The results confirmed that former CEFTA countries in general showed IIT specialization in the production of vertically differentiated products of lower quality either at the aggregate level of the manufacturing sectors (i.e. SITC 5–8) or at the level of the twenty chosen manufacturing activities (i.e. divisions 17–36 of the ISIC) and that differences also exist between IIT specializations of these countries.intra-industry trade, horizontal and vertical intra-industry trade, CEFTA countries