Arbeitspapier

Comparative Advantage, the Rank-size Rule, and Zipf's Law

Using a comprehensive international trade data set we investigate empirical regularities (known as Zipf’s Law or the rank-size rule) for the distribution of the interaction between countries as measured by revealed comparative advantage. Using the recently developed estimator by Gabaix and Ibragimov (2006) we find strong evidence in favor of the rank-size rule along the time, country, and sector dimension for three different levels of data aggregation. The estimated power exponents that characterize the distribution of revealed comparative advantage are stable over time but differ between countries and sectors. These differences are related empirically to country and sector characteristics, including population size, GDP, and factor intensities.

Language
Englisch

Bibliographic citation
Series: Tinbergen Institute Discussion Paper ; No. 06-100/1

Classification
Wirtschaft
Estimation: General
Multiple or Simultaneous Equation Models: Panel Data Models; Spatio-temporal Models
Size and Spatial Distributions of Regional Economic Activity
Subject
Revealed comparative advantage
Balassa index
rank-size rule
Zipf’s Law
power law
Pareto distribution

Event
Geistige Schöpfung
(who)
Hinloopen, Jeroen
van Marrewijk, Charles
Event
Veröffentlichung
(who)
Tinbergen Institute
(where)
Amsterdam and Rotterdam
(when)
2006

Handle
Last update
10.03.2025, 11:45 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Hinloopen, Jeroen
  • van Marrewijk, Charles
  • Tinbergen Institute

Time of origin

  • 2006

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