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Relative Export Structures and Vertical Specialization: A Simple Cross-Country Index


  • José R. Maria
  • João Amador
  • Sónia Cabral


Relative export structures have changed substantially over the last forty years. We map these changes using a new cross-country specialization index - the B* -, defined as the export weight of a given product on total domestic exports, “normalized” by the average weight across all countries of the world. This indicator is close to the Revealed Comparative Advantage index suggested in Balassa (1965); it has been used as an intermediate calculation in some papers but it has never been highlighted or interpreted as an alternative index in its own right. We provide empirical evidence on the shape of the distribution of the B* for different technological sectors (high, medium-high, medium-low and low-technology sectors), how it has evolved through time and how its intra-distribution dynamics behave. The results indicate a relatively important degree of persistence, although the cross-country specialization distributions depict substantial differences as we move up the technology ladder. Special attention is given to the G5 countries and China. These economies are relatively more specialized in high-tech and medium high-tech products. China shows a striking increase in specialization in high-tech products and a substantial decrease in low-tech. Finally, by computing the B* for both exports and imports, we have identified countries with significant vertical specialization activities. These activities are predominant in high-tech industries and seem to be geographically concentrated in East-Asia.

Suggested Citation

  • José R. Maria & João Amador & Sónia Cabral, 2007. "Relative Export Structures and Vertical Specialization: A Simple Cross-Country Index," Working Papers w200701, Banco de Portugal, Economics and Research Department.
  • Handle: RePEc:ptu:wpaper:w200701

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    References listed on IDEAS

    1. Luca De Benedictis & Massimo Tamberi, 2004. "Overall Specialization Empirics: Techniques and Applications," Open Economies Review, Springer, vol. 15(4), pages 323-346, October.
    2. Luca De Benedictis, 2005. "Three Decades of Italian Comparative Advantages," The World Economy, Wiley Blackwell, vol. 28(11), pages 1679-1709, November.
    3. Luca DE BENEDICTIS & Massimo TAMBERI, 2002. "A note on the Balassa Index of Revealed Comparative Advantage," Working Papers 158, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    4. Shafaeddin, S. M., 2004. "Is China's accession to WTO threatening exports of developing countries?," China Economic Review, Elsevier, vol. 15(2), pages 109-144, January.
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    Cited by:

    1. Amador, João & Cabral, Sónia, 2008. "International fragmentation of production in the Portuguese economy: What do different measures tell us?," MPRA Paper 9783, University Library of Munich, Germany.
    2. Amador, João & Cabral, Sónia, 2009. "Vertical specialization across the world: A relative measure," The North American Journal of Economics and Finance, Elsevier, vol. 20(3), pages 267-280, December.
    3. Kimura, Fukunari & Obashi, Ayako, 2011. "Production Networks in East Asia: What We Know So Far," ADBI Working Papers 320, Asian Development Bank Institute.
    4. Lee, Jim, 2011. "Export specialization and economic growth around the world," Economic Systems, Elsevier, vol. 35(1), pages 45-63, March.
    5. João Amador & Sónia Cabral & José R. Maria, 2007. "International Trade Patterns over the Last Four Decades: How does Portugal Compare with other Cohesion Countries?," Working Papers w200714, Banco de Portugal, Economics and Research Department.

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    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General


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