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Persistence and Mobility in International TradeName: James Proudman


  • Stephen Redding


This paper examines changing patterns of specialisation in international trade in manufactured goods in the United Kingdom and Germany between 1970 and 1993. The analysis is motivated by a simple theoretical model of endogenous economic growth, in which patterns of comparative advantage are determined by the history of technological change and help determine current rates of innovation. Learning by doing that is specific to a manufacturing sector provides a reason why initial patterns of comparative advantage and international specialisation will persist over time. In contrast, spillovers of technological knowledge between economies are a source of mobility in patterns of international specialisation. We present an empirical measure of the degree of specialisation in exports of a given sector termed Revealed Comparative Advantage. The distribution of this measure across sectors provides information on international specialisation at a point in time. Analysing how the distribution evolves over time yields insights into changes in international specialisation. By explicitly modelling the dynamics of Revealed Comparative Advantage across sectors and over time, the degree of persistence and mobility in actual patterns of international trade is evaluated. The degree of mobility over the sample period is found to be surprisingly high, with the pattern of international specialisation in the United Kingdom more mobile than that in Germany.

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  • Stephen Redding, 1997. "Persistence and Mobility in International TradeName: James Proudman," Bank of England working papers 64, Bank of England.
  • Handle: RePEc:boe:boeewp:64

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    References listed on IDEAS

    1. Quah, Danny, 1993. "Empirical cross-section dynamics in economic growth," European Economic Review, Elsevier, vol. 37(2-3), pages 426-434, April.
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    7. Redding, Stephen, 1999. "Dynamic Comparative Advantage and the Welfare Effects of Trade," Oxford Economic Papers, Oxford University Press, vol. 51(1), pages 15-39, January.
    8. Dornbusch, Rudiger & Fischer, Stanley & Samuelson, Paul A, 1977. "Comparative Advantage, Trade, and Payments in a Ricardian Model with a Continuum of Goods," American Economic Review, American Economic Association, vol. 67(5), pages 823-839, December.
    9. Quah, Danny T, 1996. "Convergence Empirics across Economies with (Some) Capital Mobility," Journal of Economic Growth, Springer, vol. 1(1), pages 95-124, March.
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