Dynamic Comparative Advantages in the ASEAN+3

Dynamic Comparative Advantages in the ASEAN+3

This paper aims to investigate the dynamic changes in comparative advantage of the ASEAN, China, Republic of Korea and Japan (commonly abbreviated as the ASEAN+3). By applying statistical and econometric methods on Revealed Symmetric Comparative Advantage (RSCA) index, this paper concludes that there have been changes in the patterns of comparative advantage in the ASEAN+3. The increases in overall comparative advantage are encouraged by the higher increases in comparative advantage of groups of products that had no or lower comparative advantage in the past. The comparative advantage pattern of the ASEAN is becoming similar with that of Japan. However, there is no stationary level of similarity in the patterns of comparative advantage.