BRIC national export performance: a portfolio approach

The BRIC countries (Brazil, Russia, India, and China) have expanded their export sector considerably in the last two decades. Their export portfolios range from commodities to knowledge-intensive products. In this paper, we use two portfolio approaches (Markowitz and single index models) to assess export diversification strategies. The results indicate that China’s export portfolio dominates the portfolios of Brazil, India, and Russia. China has a highly diversified export profile and also expresses the highest efficiency amongst the BRIC countries. Thus, we make several conclusions about the impact of BRIC countries on the global political economy: (1) export portfolios can be used as a measure of geo-political influence, (2) BRIC countries’ export performance approximates the economic behavior of a global ‘middle class,’ and (3) China’s dominance among the BRIC countries, particularly its diverse profile, largely represents the global economy. China’s portfolio beta for export is closest to the global portfolio beta.