Dynamics of Chinese Comparative Advantage

Abstract

We analyze the dynamics of Chinese comparative advantage as measured by export shares and the Balassa index using 3-digit and 4-digit sectors for the period 1970 - 1997. We use novel tools to identify periods of rapid structural change and the persistence of comparative advantage, such as Galtonian regressions, probability-probability (p-p) plots, and the Harmonic Mass index, to supplement the usual descriptive statistical methods and mobility indicators associated with Markov transition matrices.

Keywords: Balassa index, distribution dynamics, Galtonian regression, Markov matrices, P-P plots, HM index

JEL Classification: E63, F14, F40, N95, O10, O53, P30, R11