by marco
Tue Jan 23rd, 2007 at 04:06:54 AM EST
from the diaries, with minor edits. -- Jérôme
Responding to a comment by Laurent in last night's Open Thread, oldfrog pointed out that
German export volumes are beating all records, compared to France (I think there was a graph about that on ET not that long ago) despite the fact that both countries are using the same currency.
News to me. I have not been able to find that graph, but produced two graphs of the nearest thing I could find on EuroStat during lunch:
External balance of goods and services - Constant prices - % of GDP
External balance of goods and services - Current prices - EUR M
(see both below the fold)
And these confirm what oldfrog says. Oldfrog speculates:
if the Germans succeed in exporting much more than France - despite a high Euro - is because their products are more competitive or maybe more needed than the respective French ones, or because the French don't export the kind of stuff the Germans do.
Maybe some of the economists on ET could explain that for us...
I did some looking around to find an answer, but the best I could come up with was part of an answer in a Le Monde interview with Jean-Pierre Chevènement, who says:
Germany would be mistaken to believe itself immunized against a strong euro, for it has had a virtual monopoly on exports of capital goods [biens d'équipement] since the end of the 19th century. This is short term thinking, since China is very quickly going to be producing goods at a better price.
Is he right? Are capital goods the primary if not only reason that Germany is exporting so much compared to France?
Here are the two graphs from EuroStat:
(I couldn't figure out how to set the parameters on EuroStat to have the bars for France and Germany side by side within each time segment, so they the data for each country is presented in a separate block: the block of bars on the left side are for Germany, while the block of bars on the right side are for France. To see the data clearly, it's best to click on the graphs and expand them to full size. Note that each colored block represents a quarter from 2003Q4 through 2006Q3.)
External balance of goods and services - Constant prices - Percentage of GDP - SA
The external balance of goods and services (ESA 1995, 8.68) is the difference between exports of goods and services and imports of goods and services. If positive, the economy exports more goods and services than it imports, and vice versa. Values are seasonally adjusted (SA). The ESA 95 (European System of Accounts) regulation may be referred to for more specific explanations on methodology.
External balance of goods and services - Current prices - Millions of euro - SA
The external balance of goods and services (ESA 1995, 8.68) is the difference between exports of goods and services and imports of goods and services If positive, the economy exports more goods and services than it imports, and vice versa. The share of GDP is calculated on the basis of seasonally adjusted values. The ESA 95 (European System of Accounts) regulation may be referred to for more specific explanations on methodology.
