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Revealed Comparative Advantage of Malaysian Exports: The Case for Changing Export Composition

Author

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  • Mahani Zainal Abidin

    (Institute of Strategic and International Studies, Malaysia, No. 1, Pesiaran Sultan, Salahuddin, 50778, Kuala Lumpur, Malaysia.)

  • Wai Heng Loke

    (Faculty of Economics and Administration, University of Malaya, Malaysia.)

Abstract

Since 2000, Malaysian-manufactured exports performance has been declining. The downturn of the global electronic industry and the rise of China's economy are the two major causes of this decline. To improve export performance, Malaysia participates in multilateral, regional, and bilateral trade liberalization. The competitiveness of Malaysian manufactured exports can be improved by examining the pattern of revealed comparative advantage (RCA). Within the non-resource-based manufactured exports, Malaysia still has comparative advantage for electrical and electronic goods and machinery (its largest export item), even though it has been on a decline. Malaysia's export strength has also gradually shifted from non-resource-based to resource-based manufactured exports. The RCA estimates also suggest that trade liberalization must not only lower or eliminate tariffs on final products, but also reduce import duties if exports were to increase their competitiveness. (c) 2008 The Earth Institute at Columbia University and the Massachusetts Institute of Technology.

Suggested Citation

  • Mahani Zainal Abidin & Wai Heng Loke, 2008. "Revealed Comparative Advantage of Malaysian Exports: The Case for Changing Export Composition," Asian Economic Papers, MIT Press, vol. 7(3), pages 130-147, Fall.
    • Handle: RePEc:tpr:asiaec:v:7:y:2008:i:3:p:130-147
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    Cited by:

    1. Lakatos, Csilla & Walmsley, Terrie, 2011. "Dispute Settlement at the WTO: Impacts of a No Deal in the US-Brazil Cotton Dispute," Conference papers 332059, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    2. Malik Saqib Ali & Sana Zaigham, 2017. "Energy Crisis and Comparative Advantage Industries: Empirical Evidence from the Pakistan Economy," Global Economics Review, Humanity Only, vol. 2(1), pages 42-48, December.
    3. Böhringer, Christoph & Garcia-Muros, Xaquin & Cazcarro, Ignacio & Arto, Iñaki, 2017. "The efficiency cost of protective measures in climate policy," Energy Policy, Elsevier, vol. 104(C), pages 446-454.
    4. repec:zbw:hohpro:338 is not listed on IDEAS
    5. Ahasanul Haque & Naila Anwar & Zariyah Ibrahim, 2013. "Export of Furniture Product from Malaysia: Market Prospects and Challenges," Journal of Economics and Behavioral Studies, AMH International, vol. 5(7), pages 406-419.
    6. Hoang, V. V. & Tran, K. T. & Tu, B. V. & Nguyen, V. N. & Nguyen, A. Q., 2017. "Agricultural Competitiveness of Vietnam by the RCA and the NRCA Indices, and Consistency of Competitiveness Indices," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 9(4).
    7. repec:old:wpaper:338 is not listed on IDEAS
    8. Christoph Böhringer & Victoria Alexeeva-Talebi, 2011. "Unilateral climate policy and competitiveness: The implications of differential emission pricing," Working Papers V-338-11, University of Oldenburg, Department of Economics, revised Jun 2011.
    9. Judit Nagy & Zsófia Jámbor, 2018. "Competitiveness In Global Trade: The Case Of The Automobile Industry," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 63(218), pages 61-84, July – Se.

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