The Changing Trade and Revealed Comparative Advantages of Asian and Latin American Manufacture Exports
AbstractChanges in comparative advantage should reflect changes in factor endowment, but increasingly, changes in trade policies also affect a region's trade performance. Based on the arguments in Balassa's stages of comparative advantage thesis, this paper looks at the performance of manufacture exports in a number of Asian and Latin American economies over the period 1981-1997 and examines the revealed comparative advantage indices between economies in East Asia, Southeast Asia and Latin America. Although the RCA measurement may not distinguish between the factor endowment effects from the trade policy effect, we argue that RCA measures provide indication on the movement in a region's comparative advantage. The evidence strongly suggests that despite the strong export performance experienced by East Asian economies, they are losing their comparative advantage to the lower-tier economies in Southeast Asia and Latin America.
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Bibliographic InfoPaper provided by Economic Growth Center, Yale University in its series Working Papers with number 843.
Length: 24 pages
Date of creation: Mar 2002
Date of revision:
International Trade; Revealed Comparative Advantage; Manufacture Exports;
Find related papers by JEL classification:
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
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