Patterns and distances of catch-up in trade: China and East Asia

The main purpose of this paper is to determine the relative position (distances) of East Asian countries (including South East Asia) within their own geographical area and in relation to the rest of the world. For this purpose, Balassa's (1965) ‘revealed comparative advantage’ (RCA) in exports will be used to assess trade performance and economic growth. We use multidimensional scaling to ascertain our contentions. First, East Asian countries are forming a ‘flying geese’ formation whose leader is Japan followed by Korea and Taiwan and further behind China and the ASEAN countries. Second, this flying geese flock in terms of RCA ranks is paralleled with a similar flying geese formation in terms of economic development. Furthermore the mapping of 100 countries (and a close-up of 45 countries) tell us as to how all relevant countries are positioned in terms of 14 industrial sectors (here we also used factor analysis to classify these sectors).