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New revealed comparative advantage index: Dataset and empirical distribution

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  • Elsa Leromain
  • Gianluca Orefice

Abstract

This paper presents a new database of revealed comparative advantage (RCA) measures based on the recent index of RCA proposed by Costinot et al. (2012). This new index conceptually fits the ex ante and country-sector specific nature of the Ricardian comparative advantage better than the traditional Balassa index. The Balassa index, indeed, being computed directly on observed export flows, does not distinguish between exporter, importer and sector specific factors affecting export flows. The RCA index proposed by Costinot et al. (2012) derives from a micro-foundation of the Ricardian model and, being an econometrically based measure, is able to fit the ex ante nature of Ricardian comparative advantage. Costinot et al. (2012) compute the RCA for a sample of 21 OECD countries and 13 industries (ISIC) in 1997. In this paper, we extend the RCA calculations to the period 1995–2010 up to a HS4 digit product classification for manufacturing (i.e. 1018 products). We also present some empirical distribution features of the new index in comparison with the traditional Balassa index.

Suggested Citation

  • Elsa Leromain & Gianluca Orefice, 2014. "New revealed comparative advantage index: Dataset and empirical distribution," International Economics, CEPII research center, issue 139, pages 48-70.
    • Handle: RePEc:cii:cepiie:2014-q3-139-3
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    More about this item

    Keywords

    Revealed comparative advantage; Ricardian model; Exports;
    All these keywords.

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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