This paper investigates the determinants of comparative advantage in Artificial Intelligence (AI)-intensive industries using a comprehensive dataset of US imports from 68 countries across 79 manufacturing and service industries over the period 1999–2019. Using a novel measure of AI intensity...

Based on the sufficient statistics approach developed by Huang and Ottaviano (2024), we show how the state of technology of European industries relative to the rest of the world can be empirically assessed in a way that is simple in terms of computation, parsimonious in terms of data...

According to the general consensus in academia, Ricardo's theory of international trade embodies the theory of comparative advantage. The principle of comparative advantage he proposed, based on the model of physical trade and employing comparative cost analysis, holds that comparative advantage...

Policies that affect t he c ost o f u sing f ossil f uels i n p roduction h ave a complex impact on the economy. In this paper, we focus on the role of these policies for the pattern of comparative advantage through their effect o n p roduction c osts in manufacturing industries. Using data on...

Based on the sufficient statistics approach developed by Huang and Ottaviano (2024), we show how the state of technology of European industries relative to the rest of the world can be empirically assessed in a way that is simple in terms of computation, parsimonious in terms of data...

The existing literature on development and economic diversification finds an inverted-U function between these two variables, whereby economies diversify as they grow up to a point, after which they start specializing. This paper contributes to this literature by investigating the stages of...

This study introduces a two-dimensional matrix analysis method that utilizes revealed comparative advantage and revealed comparative disadvantage indices. It aims to clarify the impact of trade remedy measures on beneficiary industries' performance. We compare the effects of these measures...

Do political regimes determine how geopolitics influence international trade? This paper provides an empirical answer to the question by analyzing the joint impact of democracy and geopolitical distance between countries with an augmented gravity model of bilateral trade flows and an extensive...

In this work, we develop a trade model that explains the pattern of trade between countries based on differences in total factor productivity (TFP) while also accounting for differences in relative factor endowments. The novelty stems from the introduction of production functions derived by...

Currently, international trade has evolved into international production fragmentation captured in GVCs. Countries must enhance intermediate exports in comparative advantage sectors to increase their trade in value-added (TVA) in global production chains. However, traditional measurements of...

We show that climate policy can unlock large environmental gains from trade by inducing economies to specialize according to their environmental comparative advantage. We make this point by exploring the effects of a carbon tax in a quantitative trade model. Our main result is that the...

Traditional gravity models posit an inverse relationship between geographical distance and bilateral trade due to increased transportation costs. However, recent literature suggests that bilateral service trade may increase between two countries located at an appropriate geographical distance....

Recent shocks to global value chains and geopolitical tensions have reignited the debate on domestic production of strategic goods and technologies. This paper proposes an analytical framework for identifying and prioritising activities and regions for potential reshoring policies combining...

Logistics is an essential service for manufacturing because it supports the coordination and integration of global production activities, ultimately reducing costs and improving efficiency. However, it is not clear that the complex structural relationship between logistics and manufacturing...

We study the impact of the widening energy price differentials caused by the war in Ukraine on the returns of European and US firms. Using several measures of firms’ exposure to energy consumption, we show that return differentials between EU and US firms widened significantly and persistently...

According to the theory of comparative advantage, each country would recognize these facts and stop attempting to make more luxurious locally for engaging in trade. David Ricardo developed the classical theory of comparative advantage in 1817 to clarify why countries engage in international...

The Eurasian Economic Union (EAEU) is a relatively newly-formed regional integration bloc. It evolved on the basis of the Customs Union of Russia, Kazakhstan, and Belarus in 2015 with Armenia and Kyrgyzstan joining the agreement. The foreign economic aspirations of the EAEU as a single market,...

This study investigates how improved intellectual property rights (IPR) institutions can result in divergent trade patterns for economies in different stages of development but be beneficial through different mechanisms. While IPR protection is a determinant of comparative advantage for OECD...

Worker sorting into tasks and occupations has long been recognized as an important feature of labor markets. But this sorting may be inefficient if jobseekers have inaccurate beliefs about their skills and therefore apply to jobs that do not match their skills. To test this idea, we measure...

Much research shows that students take account of their perceived comparative advantage in mathematics relative to verbal skills when choosing college majors and career tracks. There is also evidence for an important role for comparative advantage in explaining the gender gap in college STEM...

The active spread of COVID-19 and the resulting containment measures have made it clear that both supply and demand and global production networks are facing unprecedented shocks and disruptions. Accordingly, this has resulted in an urgent need to investigate countries' competitive situation...

Cinnamon is one of the plantation spice commodities that contributes to the Indonesian economy. Indonesia is the largest exporter country in the world regarding the total export volume of cinnamon, but regarding the total value of exports, Indonesia comes in second after Sri Lanka. This study...