Identifying Vulnerable Industries and Regions: The Proposed European Single Market and Portuguese Manufacturing

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Abstract
This article presents a simple methodology for assessing the vulnerability of industries and regions in an environment of increasing wages. The analysis was motivated by the proposed European Single Market Act and the effects it will likely have on Portugal. The methodology shows that the most vulnerable industries are those with high labor intensity and low wages, a result that contrasts sharply with other studies. Due to the geographical concentration of these vulnerable industries, the regional consequences of European Community integration on Portuguese manufacturing will be considerable.