Gains from trade? A complex network analysis of impact of international trade on economic convergence

A corollary of the principle of comparative advantage is that international trade will lead to economic convergence between countries. This encouragement of development makes trade a central part of the economic policies of agencies such as the International Monetary Fund and the World Bank. This paper uses complex network analysis to look for evidence of economic convergence. The analysis is based on 65 years of trade data. The expectation is that either economic convergence or divergence will lead to measurable changes in the structure of the international trade network. However, the structure of the international trade network is remarkably stable over this time period. This suggests that the dramatic increase in international trade volume over this period has not led to economic convergence. Consequently, policies that are justified by assuming that convergence will follow from increased trade need to be re-evaluated.