Static and Dynamic Revealed Comparative Advantage: A Comparative Analysis of Turkey and Russia

Year 2017, Volume: 4 Issue: 3, 22 - 38, 17.07.2017

Sevcan Güneş , Marina Tan

Abstract

With respect to bilateral trade
between Turkey and Russia, static and dynamic RCA was calculated for 14 ‘common
sectors’, in which Russia and Turkey exported similar quantities of goods to
the rest of the world. The static RCA is indicative of the fact that Turkey is
more advantageous than Russia at both bilateral and global levels. However; an
analysis of dynamic RCA for the 14 common sectors revealed that while Turkey
has dynamic comparative advantage for six sectors, Russia has dynamic
comparative advantage for 11 sectors. Despite the fact that Russia is more
disadvantageous than Turkey in static terms, it has more sectors falling under
the rising star category in dynamic terms. In this context the results of this
study could be used to develop new fiscal policies to improve both static and
dynamic sectorial comparative advantage. 

Keywords

Trade, Revealed Comparative Advantage, Balassa Index

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