The Transformation of Competitive Advantage in East Asia: An Analysis of Technological and Trade Specialisation

In recent years there has been considerable interest in the relationship between a country's export competitiveness and the role played by technology in strengthening and maintaining competitive advantage. A central feature of recent empirical work, mainly focused on the OECD countries, has rested on examining patterns of export and technological specialisation between economies and sectors. This paper moves attention away from the advanced industrialised economies to examine the trends for trade and technological specialisation among the East Asian developing economies. In particular, two aspects of specialisation are examined. First, to what extent have patterns of competitive advantage changed over time and second, to measure the relationship between patterns of trade and technological specialisation. Important differences are found in the patterns of specialisation, and in the relationship between them among the advanced East Asian economies and those catching up.