What the OECD-WTO TiVA Data Tell Us about Comparative Advantage and International Trade in General

In this article, the recently published OECD-WTO TiVA data are used to re-examine the question of comparative advantage. Using the framework developed in Beaudreau (2011) Beaudreau, B. 2011. “Vertical Comparative Advantage”. In International Trade Journal 305–348. 25(3). [Google Scholar], it delves into the structural determinants of vertical, as opposed to horizontal, comparative advantage (VCA). In particular, it is shown that resource-based VCAs are fewer in number but greater in magnitude than knowledge-based ones, and that VCAs in R&D-intensive sectors are greater in number but smaller in magnitude. Furthermore, it is shown that countries specialize, having a limited number of VCAs. International specialization and comparative advantage are shown to be based in large measure on resources and knowledge.