The use of revealed comparative advantages in determining of export performances of countries: A case study for emerging market economies

The index of revealed comparative advantages was first introduced by Liesner (1958) and operationalized by Balassa (1965) in order to measure comparative advantages. The RCA index of a country for a product is often measured by the product?s share in the country?s exports in relation to its share in world trade.The index of RCA (called the Balassa Index), is used to measure the relative importance of a product in a country?s export composition relative to that products?s relative importance in world trade. If a country?s Balassa Index of RCA for an industry exceeds 1 the country is said to have a comparative advantage in industry in question, since this industry is more important for the country?s exports than for the exports of the reference countries and vice versa.In this study, between the years 1993-2005, the RCA indices of Turkey and the other emerging market economies are calculated on SITC Revision 3, 4 digit codes and the comparative advantages and disadvantages of the countries are examined both in world trade and among themselves. Export specialization/comparative advantages, in accordance with SITC technology classification have been also defined.Additionally, in this study, the export similarity indices of Turkey and the other emerging market economies are calculated and Turkey and the other countries that export relatively similar products to the world has been identified.The comparative advantages of Turkey?s exports can be explained both the labour proportion and the capital proportion in the Turkish economy. In addition to that, the results show that the capital-intensive goods have a significant impact on the rise of Turkey?s exports share in the world trade. In considering the science-based goods, Turkey has a comparative disadvantage. However, the RCA indices are increasing gradually in recent years and they are leading to considerable increases Turkey?s exports share in the world trade.Although the exports of vegetables and fruit, articles of apparel and clothing accessories and textile yarn and fabrics of Turkey has decreased for the period between 1993-2005 in total exports, Turkey maintains the comparative advanteges over the competitors in the world trade.