The normalized revealed comparative advantage index

In this paper, we propose the normalized revealed comparative advantage (NRCA) index as an alternative measure of comparative advantage. The NRCA index is demonstrated capable of revealing the extent of comparative advantage that a country has in a commodity more precisely and consistently than other alternative RCA indices in the literature. As a result, the NRCA index is comparable across commodity, country, and time. Therefore, the NRCA index provides a useful tool for quantitative regional research, especially for studies on regional comparative advantage.

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