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Consistency Test of Revealed Comparative Advantage Index: Evidence from India’s Agricultural Export

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  • Subhash Jagdambe

Abstract

This article analyses the competitiveness of India’s agricultural products in world markets. Four indices of revealed comparative advantage (RCA) were used at the four-digit level of harmonized system (HS) of classification for the period of 1996–2015. Under live animal products, 7 out of 26 products showed RCA. For vegetable products, 21 out of 58 showed strong RCA. For products like animal or vegetable fat and prepared foodstuff, 2 out of 16 and 9 out of 49 showed RCA, respectively. Further, the consistency tests reveal that the indices are less satisfactory as the cardinal and dichotomous measures but relatively satisfactory as ordinal measure. Hence, study would propose an ordinal interpretation of RCAs indices for better policy formulation. The study has also found the pattern of RCA indices to be fairly stable over the years. JEL Codes: F1, Q1

Suggested Citation

  • Subhash Jagdambe, 2019. "Consistency Test of Revealed Comparative Advantage Index: Evidence from India’s Agricultural Export," Foreign Trade Review, , vol. 54(1), pages 16-28, February.
    • Handle: RePEc:sae:fortra:v:54:y:2019:i:1:p:16-28
    DOI: 10.1177/0015732518810838
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    1. Ricardo, David, 1821. "On the Principles of Political Economy and Taxation," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, edition 3, number ricardo1821.
    2. Ballance, Robert H & Forstner, Helmut & Murray, Tracy, 1987. "Consistency Tests of Alternative Measures of Comparative Advantage," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 157-161, February.
    3. Amita Batra & Zeba Khan, 2005. "Revealed comparative advantage: An analysis for India and China," Indian Council for Research on International Economic Relations, New Delhi Working Papers 168, Indian Council for Research on International Economic Relations, New Delhi, India.
    4. Thomas Vollrath, 1991. "A theoretical evaluation of alternative trade intensity measures of revealed comparative advantage," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 127(2), pages 265-280, June.
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    More about this item

    Keywords

    RCA index; consistency test; agriculture; India and world;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture

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