Export-Led Growth in the EU: Where and What to Export?

In the aftermath of the Great Recession, exports emerge as a meaningful source of growth. In this context, using a panel of 26 European Union members, we assess if and how the product and the destination structures of exports shape the growth dynamics for European countries. We find that growth is fostered through export specialization in high-value-added products, such as manufacturing and high-technology, and by export diversification across partners. However, enlarging the portfolio of partners, mainly to less developed and more distant countries, has negative impacts on growth. Unambiguously, relative concentration of exports should be directed towards higher growth countries.