Enrique Palazuelos

European Union Economies Facing ‘Baumol's Disease’ within the Service Sector*

This article analyzes the productivity of the service sector within the countries of the European Union during the period 1994–2005. After disaggregating the sector into 11 branches, the article quantifies the relative contribution of each branch to the growth of service sector aggregate productivity. The main conclusion is that the structure of the industry is increasingly dependent on those branches which have lower growth in labour productivity. This conclusion reveals that the EU service sector suffers from ‘Baumols disease’, which helps to accentuate the slow productivity growth that characterizes this sector.

A Political Economy Approach to the European Union Gas Model: Continuities and Changes†

The European Union gas model worked steadily for nearly four decades: since the time that gas first emerged as an important resource in European energy demand. However, since the late 1990s this stability has been disrupted by a number of factors. The EU reform agenda has been the most important of these. Following a structural-conduct-performance plan, the European Commission has forced changes on players, scenarios and exchange mechanisms through legislative action in order to build a new energy model based on those operating in the United States and the United Kingdom. The main point of this article is that despite these actions, many features of the traditional model have been modified but not removed, and many changes have not brought the results initially expected. These results are mainly due to the fact that the power relations among the main players of the pre-reform model are still in place.

Labour Productivity: A Comparative Analysis of the European Union and United States, 1994–2007

This article confirms that labour productivity in the European economies has continued to slow down in recent years. U.S. productivity growth has been higher than in the EU, but only since 2001. At the same time, both economies have modified previous employment performance: EU employment growth is now higher than in U.S. This article proposes that productivity growth be explained by demand dynamics, and investment in particular, not forgetting the influence of employment, along with other factors such as new technologies.

China's energy transition: features and drivers

Since the 1990s China has been undergoing an energy transition. Increasing dependence on foreign hydrocarbons is the transformations most striking feature, leading much analysis of Chinas energy system toward geo-strategic studies. This article analyses a) the features defining the transition – not exclusively dependence on foreign oil markets – highlighting continuities and ruptures with tradition; and b) relations between the transformation and three elements of Chinas current development phase: i) strong growth and changing industrial specialisation, ii) transport expansion and iii) urbanisation and new consumption habits. If these elements are indeed drivers, and if they persist, current features of the transition (including growing dependence on external markets) will continue.