Internationalization via export growth and specialization in Finnish regions

Figures & data

Table 1. Summary of regional IC and tangible investments per labor, export and profit shares of value added in private sector in Finland 2000–2013

Variable	R&D/L	(OC + ICT)/L	K/L	Export share	Operating profit/L
Ahvenanmaa	1.1	3.1	11.8	31.8	11.2
Etelä-Karjala	3.9	3.1	11.3	98.5	16.4
Etelä-Pohjanmaa	2.8	2.9	9.1	30.2	8.4
Etelä-Savo	3.0	2.8	9.2	18.0	9.2
Itä-Uusimaa	3.2	3.6	12.2	39.9	6.9
Kainuu	2.7	2.2	9.9	42.1	8.5
Kanta-Häme	3.6	4.1	7.9	58.3	4.8
Keski-Pohjanmaa	3.0	2.4	12.6	101.4	8.1
Keski-Suomi	5.0	6.3	11.3	73.5	−3.0
Kymenlaakso	4.0	2.9	13.6	64.4	8.7
Lappi	3.3	2.7	17.9	380.9	−100.2
Pirkanmaa	4.6	6.2	8.7	52.9	10.4
Ostrobothnia	4.7	4.3	11.8	84.3	13.0
Pohjois-Karjala	2.7	2.3	10.9	39.6	11.2
Pohjois-Pohjanmaa	4.3	5.6	10.7	67.0	11.2
Pohjois-Savo	3.8	3.4	9.8	64.7	7.0
Päijät-Häme	3.0	3.2	9.4	34.0	9.7
Satakunta	4.7	3.0	9.8	67.1	7.7
Uusimaa	4.9	8.3	14.0	43.0	11.6
Varsinais-Suomi	4.8	5.5	13.3	54.0	14.8

R&D per labor R&D/L, OC and ICT per labor (OC+ ICT)/L and tangible capital investment per labor K/L in thousand 2010€. Export and operating profit per value-added shares in percentage.

Table 2. Regression on the persistence of RSCA export indices

	2010–2013	2005–2009	2000–2004
Constant	−0.104***	−0.121***	−0.158***
	(10.63)	(12.66)	(14.01)
RSCA lagged	0.737***	0.679***	0.589***
	(54.66)	(51.51)	(36.24)
R^2	0.348	0.458	0.542
RSCA lagged/R	2.118	1.483	1.087
Observations	2529	3141	2467

Table 3. Growth accounting of GDP growth in production and market services

Finland by regions	GDP	Labor	Labor productivity	Tangible capital per labor		R&D per labor		OC and ICT per labor		Entry firms	Exit firms	TFP
					CD		CD		CD
Finland all years	−1.0	0.2	−1.2	0.5	2.5	0.1	−0.4	0.0	−0.3	0.8	−0.6	−3.9
Finland 2000–2004	1.2	0.7	0.4	0.5	2.5	0.1	−0.7	0.1	−0.6	1.0	−1.0	−1.5
Finland 2005–2009	−2.9	0.8	−3.7	0.9	2.5	0.1	−0.2	0.0	−0.1	0.9	−0.4	−7.3
Finland 2010–2013	−1.3	−1.2	−0.1	0.2	2.3	0.2	−0.1	0.0	−0.1	0.4	−0.4	−2.7
Ostrobothnia all years	2.6	2.8	−0.3	−0.1	4.0	−0.2	−0.1	−0.2	−0.1	0.2	0.0	−3.9
Ostrobothnia 2000–2004	1.7	−0.7	1.9	−0.5	4.0	−0.1	−0.2	−0.4	−0.3	0.2	0.1	−0.8
Ostrobothnia 2005–2009	4.2	6.4	−3.0	1.1	4.0	0.1	−0.2	0.0	0.2	0.1	0.0	−8.3
Ostrobothnia 2010–2013	1.6	2.6	0.5	−0.9	3.9	−0.6	0.2	−0.1	−0.1	0.2	0.0	−2.2
Etelä-Pohjanmaa all years	−1.1	−0.1	−1.0	0.3	3.0	0.2	0.2	−0.1	0.1	0.8	−0.3	−5.2
Etelä-Pohjanmaa 2000–2004	1.2	0.9	0.3	0.3	3.1	0.1	0.2	−0.1	0.0	0.9	−0.5	−3.6
Etelä-Pohjanmaa 2005–2009	−1.2	2.3	−3.5	1.2	3.0	0.3	0.0	−0.1	0.1	0.9	−0.4	−8.6
Etelä-Pohjanmaa 2010–2013	−3.9	−4.3	0.4	−0.7	2.9	0.4	0.3	−0.1	0.1	0.5	0.0	−3.0
Uusimaa all years	−3.6	−1.6	−2.1	0.8	4.7	0.3	0.7	0.1	2.8	0.9	−0.5	−11.9
Uusimaa 2000–2004	0.1	−0.6	0.6	1.0	4.7	0.4	0.6	0.3	3.3	1.2	−0.9	−10.1
Uusimaa 2005–2009	−6.0	−1.7	−4.3	0.9	4.7	0.1	0.6	0.0	2.8	0.7	−0.1	−14.0
Uusimaa 2010–2013	−5.2	−2.6	−2.6	0.5	4.7	0.3	1.0	0.1	2.3	0.5	−0.4	−11.6

CD, creative destruction. Growth rates for GDP and labor (employee), and labor productivity. Labor productivity growth is broken down into that explained by tangible capital, R&D, OC and ICT intensities, entry, exit and residual (TFP).

Table 4. Determinants of the regional growth of RSCA export and import indices, fixed-effect estimates

Variables	RSCA exports	RSCA imports	RSCA exports—RSCA imports
Tangible capital per labor	0.0314*	0.0268*	0.00463
	(2.56)	(2.15)	(0.38)
Tangible capital per labor CD	−0.0165	−0.0373*	0.0209
	(0.96)	(2.52)	(1.30)
R&D capital	0.0750***	0.0283*	0.0467***
	(5.84)	(2.55)	(3.76)
R&D per labor CD	−0.00109	−0.000113	−0.000975
	(0.49)	(0.09)	(0.42)
OC and ICT capital per labor	0.0130	0.0640***	−0.0510**
	(0.75)	(4.02)	(3.28)
OC and ICT per labor CD	0.00331	0.00458**	−0.00127
	(1.50)	(2.79)	(0.64)
Net entry	0.00238	−0.000704	0.00309*
	(1.54)	(0.52)	(2.09)
Total factor productivity growth	0.00170***	0.00179***	−0.0000904
	(6.82)	(7.07)	(0.48)
Average firm size	0.111***	0.125***	−0.0131
	(4.77)	(5.31)	(0.62)
Foreign value-added share	−0.00654	−0.0105*	0.00400
	(1.17)	(2.13)	(0.74)
Constant	−2.213***	−2.130***	−0.0828
	(9.44)	(9.33)	(0.39)
N	7764	7764	7764
R^2 within	0.0790	0.105	0.00364
R^2 between	0.0000595	0.000972	0.00196
R^2 total	0.0189	0.0246	0.000528
Sigma e	0.491	0.432	0.501
Sigma u	0.322	0.308	0.204
Rho	0.300	0.336	0.142

All except growth accounting variables in logs. * p < 0.05, ** p < 0.01, and *** p < 0.001.

Table 5. Determinants of the regional growth of export and import shares, fixed-effect estimates

Variables	Exports/Y	Imports/Y	Exports/Y—Imports/U (log difference)
Tangible capital per labor	0.0849	0.159*	−0.0165
	(1.37)	(2.42)	(0.23)
Tangible capital per labor CD	−0.0901	−0.141*	0.00154
	(1.19)	(2.21)	(0.02)
R&D capital	0.285***	0.121*	0.151*
	(3.96)	(2.35)	(2.09)
R&D per labor CD	−0.00466	−0.00704	0.00458
	(0.46)	(1.32)	(0.46)
OC and ICT capital per labor	0.141	0.167*	−0.0474
	(1.57)	(2.51)	(0.60)
OC and ICT per labor CD	0.0138	0.0146	−0.00149
	(1.25)	(1.80)	(0.24)
Net entry	0.000432	−0.00827	0.00639
	(0.07)	(1.43)	(1.00)
Total factor productivity growth	0.00620***	0.00642***	0.000598
	(6.07)	(6.41)	(0.68)
Average firm size	0.424***	0.455***	−0.0427
	(3.56)	(4.34)	(0.39)
Foreign value-added share	−0.00830	−0.0299	0.0173
	(0.32)	(1.50)	(0.80)
Constant	−9.252***	−8.147***	−1.333
	(7.06)	(7.61)	(1.21)
N	6353	7469	6123
R^2 within	0.0808	0.0881	0.00197
R^2 between	0.00274	0.0158	0.00763
R^2total	0.0213	0.0242	0.000921
Sigma e	1.912	1.727	1.833
Sigma u	1.334	1.247	1.039
Rho	0.327	0.343	0.243

All except growth accounting variables in logs. * p < 0.05, ** p < 0.01, and *** p < 0.001.

Figure A.1. Domestic value added in exports by domestic firms, foreign MNEs and foreign value added 2009 in 22 countries.

Figure A2. Firm types in gross exports and value added of exports in Nordic countries, 2013.

Source: Nadim (2017)

Table A.1. Summary tables of firm-level figures in Ostrobothnia, Etelä-Pohjanmaa and Uusimaa

	Ostrobothnia
Variable	Mean	Q1	Median	Q3	Std
Value added per empl.	92,159	54,342	70,083	99,162	96,602
Return on asset	14.9	10.5	15.3	19.1	7.26
Operating profit per empl.	0.107	0.0348	0.105	0.186	0.535
Export share	0.0276	2.47E-05	0.0014	0.0166	0.0798
Tangible capital per empl.	185,846	37,739	79,279	138,407	541,151
Tangible capital per empl. common growth	−0.0524	−1.09	−0.119	0.929	10.5
Creative destruction	3.98	2.99	5	5	1.36
R&D per empl.	22,400	7470	13,827	25,496	24,208
R&D investment per empl.	3754	1249	2297	4245	3921
R&D per empl. Common growth	−0.185	−0.114	0.0164	0.17	4.28
Creative destruction	−0.0981	−0.39	−0.00281	0.311	2.71
OC and ICT per empl.	13,998	4269	8227	17,659	16,559
OC and ICT investment per empl.	5343	1663	3332	7018	5793
OC and ICT per empl. common growth	−0.161	−0.172	−0.00655	0.198	4.26
Creative destruction	−0.0838	−0.52	−0.0194	0.402	3.05
Entry of new firms	0.172	−0.071	0	0.0697	1.17
Exit of firms	0.0206	0	0	0.218	1.13
Residual growth	−3.86	−17.2	−5.93	8.64	40.3
Foreign share of value added	0.158	0	0.0595	0.202	0.242
	Etelä-Pohjanmaa
Variable	Mean	Q1	Median	Q3	Std
Value added per empl.	72,026	47,976	60,494	83,145	57,770
Return on asset	13.9	9.63	14.5	18.9	7.79
Operating profit per empl.	0.0339	0.0139	0.0832	0.139	0.589
Export share	0.0307	7.06E-05	0.00222	0.0299	0.0758
Tangible capital per empl.	123,373	43,660	68,217	135,321	264,158
Tangible capital per empl. common growth	0.337	−1.15	−0.0874	0.904	8.01
Creative destruction	2.99	1.07	3.21	5	1.91
R&D per empl.	16,923	6701	11,055	19,392	19,217
R&D investment per empl.	3272	1115	1983	3316	6428
R&D per empl. common growth	0.244	−0.0923	0.0244	0.171	4.98
Creative destruction	0.155	−0.315	0	0.291	4.91
OC and ICT per empl.	11,058	3530	5412	11,754	15,265
OC and ICT investment per empl.	4177	1292	2020	4338	5816
OC and ICT per empl. common growth	−0.104	−0.178	−0.0257	0.116	1.16
Creative destruction	0.0821	−0.338	−0.0198	0.213	2.75
Entry of new firms	0.801	−0.0187	0	0.217	3.96
Exit of firms	−0.313	−0.0484	0	0.0899	2.95
Residual growth	−5.21	−17.5	−5.14	6.43	34.6
Foreign share of value added	.0408	0	0	.0163	.154
	Uusimaa
Variable	Mean	Q1	Median	Q3	Std
Value added per empl.	105,282	60,039	77,980	108,925	105,792
Return on asset	13.7	10.8	14.1	17	4.66
Operating profit per empl.	0.171	−0.0158	0.0556	0.134	1.94
Export share	.027	.000358	.00299	.0169	.0656
Tangible capital per empl.	202,226	55,235	105,754	198,697	284,704
Tangible capital per empl. common growth	0.821	−1.04	0.0896	1.73	7.09
Creative destruction	4.72	5	5	5	.826
R&D per empl.	30,103	13,415	22,537	38,094	24,803
R&D investment per empl.	5308	2249	3658	6697	4775
R&D per empl. common growth	0.276	−0.106	0.0755	0.387	2.39
Creative destruction	0.735	−0.292	0.439	1.98	3.91
OC and ICT per empl.	19,500	7367	11,981	19,989	20,440
OC and ICT investment per empl.	7395	2749	4476	7467	7597
OC and ICT per empl. common growth	0.106	−0.235	0.0495	0.318	1.58
Creative destruction	2.8	−0.0382	1.3	4.62	6.98
Entry of new firms	0.861	−0.147	0	0.416	3.76
Exit of firms	−0.458	−0.334	0.0398	0.375	3.2
Residual growth	−11.9	−24.3	−12	.882	33.9
Foreign share of value added	.185	0.0697	0.158	.272	.236

Table A.2(a). Revealed comparative advantage RCA in Ostrobothnia region in 1999–2013 using the adjusted Balassa’s comparative advantage measure RCA

Industry	RCA 2010–13	RCA 2005–09	RCA 2000–04	Industry	RCA 2010–13	RCA 2005–09	RCA 2000–04
Agriculture A	2.94	2.00	1.02	Wholesale, retail motor vehicles G45	0.13	0.09	0.21
Food products C10	0.64	0.98	0.51	Wholesale not motor vehicles G46	0.65	0.62	0.39
Textiles, Wearing, Leather C13-15	0.62	0.61	0.65	Retail trade not motor vehicles G47	1.19	0.65	0.32
Wood and wood products C16	0.06	0.05	0.74	Transport excl. Warehousing H49-51	0.03	0.52	0.03
Paper and pulp C17	0.05	1.23	1.09	Warehouse H52	0.04	1.19	0.91
Printing C18	0.34	0.56	0.46	Accommodation I53-56	0.11	0.09	0.07
Chemicals, petroleum, pharm., rubber C19-21	0.17	0.36	0.95	Publishing, motion picture I58-60	0.00	0.44	0.26
Rubber and plastic C22	1.68	2.25	1.74	Telecommunication J61	0.01	0.27	.
Other non-metallic, basic metal C22-24	0.73	1.23	0.70	Computer programming, consultancy J62	0.00	0.19	0.53
Fabricated metal C25	0.82	1.70	1.52	Information, financial service J63-64	.	0.32	0.24
Computer, electronic and optical C26	0.40	0.04	0.00	Real estate, legal, accounting J6-69	0.00	0.20	0.01
Electrical equipment C27	7.25	3.88	3.94	Head office activities 70	0.00	1.28	1.14
Machinery C28	1.61	1.63	2.54	Other technical, scientific M71-73	0.24	0.32	0.24
Motor vehicles C29	1.86	1.52	1.09	Architectural and engineering 74	0.68	2.30	0.99
Other transport equipment C30	0.97	1.35	1.02	Rental, leasing, employment M77-80	0.00	0.02	0.10
Furniture C31	0.20	0.28	0.67	Education N81-85	1.92	0.11	0.58
Other manufacturing, mining C32	0.91	1.28	0.65	Human health, social welfare Q	0.00	0.01	0.00
Electricity, gas, steam D35-37, E	6.34	6.16	0.26	Creative, entertainment, organiz. R	4.71	1.08	0.06
Construction F	0.83	0.86	1.56

Table A.2(b). Revealed comparative advantage in Etelä-Pohjanmaa region in 1999–2013 using the adjusted Balassa’s comparative advantage measure RCA

Industry	RCA 2010–13	RCA 2005–09	RCA 2000–04	Industry	RCA 2010–13	RCA 2005–09	RCA 2000–04
Agriculture A	8.59	39.92	20.65	Wholesale, retail motor vehicles G45	0.28	0.08	0.78
Food products C10	1.05	7.52	6.78	Wholesale not motor vehicles G46	0.71	0.62	0.91
Textiles, Wearing, Leather C13-15	11.39	7.78	4.01	Retail trade not motor vehicles G47	0.64	1.50	1.36
Wood and wood products C16	4.61	4.28	2.00	Transport excl. Warehousing H49-51	0.27	7.24	0.47
Paper and pulp C17	0.00	0.01	0.00	Warehouse H52	.	.	.
Printing C18	0.00	0.47	1.17	Accommodation I53-56	0.74	0.55	.
Chemicals, petroleum, pharm., rubber C19-21	0.02	0.03	0.03	Publishing, motion picture I58-60	.	.	.
Rubber and plastic C22	1.21	0.58	0.69	Telecommunication J61	.	.	0.00
Other non-metallic, basic metal C22-24	0.47	1.92	0.65	Computer programming, consultancy J62	0.03	0.04	8.17
Fabricated metal C25	4.11	2.46	7.31	Information, financial service J63-64	0.00	0.00
Computer, electronic and optical C26	0.29	0.03	0.02	Real estate, legal, accounting J6-69	1.04	3.35	0.02
Electrical equipment C27	0.83	0.08	0.23	Head office activities 70	.	.	.
Machinery C28	1.34	1.44	2.70	Other technical, scientific M71-73	0.14	2.57	0.31
Motor vehicles C29	2.23	1.65	3.02	Architectural and engineering 74	0.01	0.01	.
Other transport equipment C30	4.47	2.76	0.97	Rental, leasing, employment M77-80	0.20	0.00	0.20
Furniture C31	8.60	4.34	7.04	Education N81-85	.	0.01	.
Other manufacturing, mining C32	0.00	0.82	0.22	Human health, social welfare Q	.	.	.
Electricity, gas, steam D35-37, E	9.77	.	.	Creative, entertainment, organiz. R	0.00	.	.
Construction F	1.90	1.29	1.98

Table A.2(c). Revealed comparative advantage in Uusimaa region in 1999–2013 using the adjusted Balassa’s comparative advantage measure RCA

Industry	RCA 2010–13	RCA 2005–09	RCA 2000–04	Industry	RCA 2010–13	RCA 2005–09	RCA 2000–04
Agriculture A	0.07	0.47	0.69	Wholesale, retail motor vehicles G45	1.72	3.37	2.38
Food products C10	0.63	0.76	0.75	Wholesale not motor vehicles G46	1.74	2.05	1.72
Textiles, Wearing, Leather C13-15	0.41	0.67	0.43	Retail trade not motor vehicles G47	1.31	3.23	2.36
Wood and wood products C16	0.39	0.78	0.40	Transport excl. Warehousing H49-51	1.27	4.77	3.07
Paper and pulp C17	0.66	0.11	0.70	Warehouse H52	0.68	1.24	0.39
Printing C18	1.68	2.09	1.17	Accommodation I53-56	2.77	2.89	1.44
Chemicals, petroleum, pharm., rubber C19-21	2.60	2.83	1.76	Publishing, motion picture I58-60	1.83	3.15	1.49
Rubber and plastic C22	0.42	0.39	0.61	Telecommunication J61	1.07	1.41	2.30
Other non-metallic, basic metal C22-24	0.26	0.24	0.88	Computer programming, consultancy J62	2.08	2.62	2.37
Fabricated metal C25	0.42	0.92	0.68	Information, financial service J63-64	0.86	2.65	1.96
Computer, electronic and optical C26	1.38	0.95	1.35	Real estate, legal, accounting J6-69	2.77	1.13	0.83
Electrical equipment C27	0.48	1.01	1.53	Head office activities 70	2.32	1.46	1.49
Machinery C28	0.48	0.77	0.64	Other technical, scientific M71-73	1.62	2.88	1.03
Motor vehicles C29	0.06	0.10	0.37	Architectural and engineering 74	3.05	4.21	2.83
Other transport equipment C30	0.26	0.06	0.56	Rental, leasing, employment M77-80	2.15	3.83	2.48
Furniture C31	0.25	1.18	1.32	Education N81-85	0.95	1.84	1.01
Other manufacturing, mining C32	1.90	3.25	1.75	Human health, social welfare Q	3.20	3.70	2.72
Electricity, gas, steam D35-37, E	0.27	0.24	1.28	Creative, entertainment, organiz. R	1.51	2.17	1.01
Construction F	1.44	2.98	1.26

Nadim, A. (2017), ‘Trade in value added and beyond: Developing integrated international economic accounts’, The joint Eurostat – DG RTD satellite event on “Challenges in measuring productivity, growth and intangibles” of the Eurostat biannual conference “New Techniques and Technologies for Official Statistics – Increasing Data Relevance for All” (13 – 17 March 2017), OECD.

 Google Scholar