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№ 2021/2

Economy under the conditions of modern transformations

PUSTOVOIT Oleh Valentynovych¹

¹Institute for Economics and Forecasting, NAS of Ukraine

PRICE AND VALUE COMPETITIVENESS OF UKRAINIAN MERCHANDISE EXPORTS

Ekon. prognozuvannâ 2021; 2:7-31

https://doi.org/10.15407/eip2021.02.007

ABSTRACT ▼

In economics, "competitiveness" remains a very general concept, and its use in applied research does not allow combining their results and making unambiguous conclusions. This process is also complicated by the fact that the concept is composite and has two components – the price competitiveness and the value competitiveness. The latter can serve as an indicator of qualitative changes in the economy. However, this aspect of competitiveness in developing countries is still disregarded by researchers. Therefore, it is safe to say that today there are no studies, which, with a high level of accuracy, can analyze the value competitiveness of exports in such countries. Economists usually focus their efforts on the analysis of export price competitiveness and one of its main factors, which is the exchange rate of the national currency. However, this approach has limited cognitive capabilities, because the emergence of new centers of global growth, such as China and India is impossible to explain, based only on the high price competitiveness of their exports.
The article attempts to solve some accumulated problems in economic science. In particular, based on the results of the analysis of modern definitions of the concept of "competitiveness", the author proposes to expand its content, generalizing the level of conformity of goods (services) to consumer preferences of market participants. This conceptual position is used to deepen the understanding of the basic, value and price competitiveness of products. A method for assessing the dominant role of value (price) competitiveness of exports in ensuring its dynamics has been developed. According to the results of the of methodology, it was found that in Ukraine’s export markets, the cyclical process of alternating growth of value or price competitiveness of this country’s products is mostly interrupted. The reason for this is the high price competitiveness of raw material exports, which is mainly attained due to low wages in the economy.
In international markets, value competitiveness is inherent in a relatively small number of product groups of Ukrainian products. These include: insulated wires, cables and other insulated electrical conductors; fiber optic cables; turbojet engines, turboprop and other gas turbines; weapons, ammunition, their parts and accessories; electric heating devices and apparatus; vessels intended for the carriage of persons or goods; tugs and pushers; parts of aircraft; cars for transportation of passengers, cargoes, including self-propelled ones; water steam turbines and other steam turbines; and women's and men's clothing. It is substantiated that from the point of view of finding a new strategy of economic growth for Ukraine, the most urgent issues are not those of intensifying export activities, but those of updating the composition of the largest export commodity groups. Leading positions among them should be occupied by goods with a large share of value added, and increased technological complexity and value competitiveness. The beginning of this process will mean the emergence of new qualitative changes in the economy, and the effectiveness of public policy of economic reform.

Keywords:export, import, goods, services, consumer preferences, unit value, basic competitiveness, price competitiveness, value (non-price, qualitative) competitiveness, economic growth

JEL: F10, F43

Article in Ukrainian (pp. 7 - 31)

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№ 2021/2

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