Domestic Production Linkages and Sectoral Shifts in Central Europe: An Input–Output Perspective

This paper examines changes in productive structures and domestic inter-industry linkages in five Central European countries- the V4 group and Austria- over 2000–2023. Despite previous studies, evidence remains limited on how domestic inter-industry linkages and sectoral transformations have evolved across these economies, particularly in the primary sector and agriculture. Using national input-output tables from the Asian Development Bank, demand multipliers (output, import, and value added) were calculated at the industry level and aggregated by sector and subsector to reflect sectoral trends and relationships. The analysis focuses on structural transformation, with emphasis on the primary sector and agriculture. Findings confirm a more stable sectoral structure in Austria, while structural shifts persisted in the V4 countries even after 2010. Transformation was most pronounced in the early period, with the primary sector declining in favour of secondary and tertiary sectors, dominated by manufacturing and services. Agriculture’s value added remained relatively stable, despite weakening domestic linkages and rising import dependence. At the same time, integration into global value chains increased reliance on imported inputs across sectors. The results suggest that V4 countries should strengthen agricultural resilience by focusing on innovation to improve domestic value added creation and reduce vulnerability to external shocks.