EU INTEGRATION AND PRODUCTION NETWORKS

The aim of this paper is to analyse the participation of Spain in International Production Networks using parts and components trade data from 1990 to 2009. We are particularly interested in understanding the potential contribution of factor endowment differences in networking and the impact of belonging to a common geographical and trading area such as the European Union on this participation strategy. Using an extended gravity panel data model, we find that Spain’s integration into production networking results from its comparative advantage but also from other factors such as EU membership and good quality transport and communication infrastructures.