Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2006-11-06
Number: 06-100/1
Author-Name: Jeroen Hinloopen
Author-Email: j.hinloopen@uva.nl
Author-Workplace-Name: Universiteit van Amsterdam
Author-Name: Charles van Marrewijk
Author-Email: vanmarrewijk@few.eur.nl
Author-Workplace-Name: Erasmus Universiteit Rotterdam
Title: Comparative Advantage, the Rank-size Rule, and Zipf's Law
Abstract: Using a comprehensive international trade data set we investigate empirical regularities (known as Zipf’s Law or the rank-size rule) for the distribution of the interaction between countries as measured by revealed comparative advantage. Using the recently developed estimator by Gabaix and Ibragimov (2006) we find strong evidence in favor of the rank-size rule along the time, country, and sector dimension for three different levels of data aggregation. The estimated power exponents that characterize the distribution of revealed comparative advantage are stable over time but differ between countries and sectors. These differences are related empirically to country and sector characteristics, including population size, GDP, and factor intensities.
Classification-JEL: C13; C33; F1; L1; O5; R12
Keywords: Revealed comparative advantage; Balassa index; rank-size rule; Zipf’s Law; power law; Pareto distribution
File-Url: https://papers.tinbergen.nl/06100.pdf
File-Format: application/pdf
File-Size: 333539 bytes
Handle: RePEc:tin:wpaper:20060100