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Sectoral reallocations, real estate shocks, and productivity divergence in Europe

Author

Listed:
  • Thomas Grjebine

    (CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique)

  • Jérôme Héricourt

    (CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique, LEM - Lille économie management - UMR 9221 - UA - Université d'Artois - UCL - Université catholique de Lille - Université de Lille - CNRS - Centre National de la Recherche Scientifique)

  • Fabien Tripier

    (LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique)

Abstract
This paper investigates the role of sectoral reallocations in the divergence of productivity in Europe, based on a database for 33 sectors and 14 countries between 1995 and 2015. Using the contribution of sectoral productivity growth to Total Factor Productivity (TFP) dynamics at the country level, we highlight that variations in the relative size of sectors—less productive sectors growing relatively to more productive ones—have been at the origin of variable productivity losses in main European countries. Parallel to this divergence, European countries experienced heterogeneous real estate price dynamics, which took the form, in some economies, of massive boom-bust cycles. We investigate real estate shocks as a potential source of sectoral reallocations through a collateral mechanism. These shocks turn out to be a strong driver of productivity divergence between European countries.

Suggested Citation

  • Thomas Grjebine & Jérôme Héricourt & Fabien Tripier, 2022. "Sectoral reallocations, real estate shocks, and productivity divergence in Europe," Post-Print hal-03954554, HAL.
    • Handle: RePEc:hal:journl:hal-03954554
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    References listed on IDEAS

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    Cited by:

    1. Thomas Grjebine & Jérôme Héricourt & Fabien Tripier, 2019. "Sectoral Reallocations, Real Estate Shocks and Productivity Divergence in Europe: a Tale of Three Countries," EconPol Policy Reports 15, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.

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    More about this item

    Keywords

    Productivity; Sectoral Reallocations; Real Estate Shocks; Collateral;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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