The Comparative Advantage and the Knowledge-Based Economy. Experiences from Polish-Chinese trade

Abstract

RESEARCH OBJECTIVE: The aim of this study was to identify trade patterns between Poland and China in the context of the theory of comparative advantage and the knowledge-based economy. THE RESEARCH PROBLEM AND METHODS: The central question was to answer whether Poland has strengthened its competitive advantage in any product categories through recorded increases in normalized revealed comparative advantage (NRCA), using the modified indicator version. The approach of the above analysis enabled the conducted research to assess whether Poland’s trade with China, especially those in the field of high-technology, were carried out in accordance with the theory of comparative advantage, during the analyzed decade (2013 - 2022). THE PROCESS OF ARGUMENTATION: In the first stage, a review of the literature on foreign trade was carried out. This was important as it sheds light on the issues of comparative advantage, with a particular emphasis on its links with the knowledge-based economy. Then, the main characteristics of Polish-Chinese trade were analysed and presented together with their results in order to identify areas of comparative advantages using the NRCA index. RESEARCH RESULTS: Poland-China trade reveals gradual change and this is evidenced by changes in the NRCA index, which is in line with changes in the export structure of both countries. However, in the case of Poland, the nature and direction of these advantages is – although slowly changing - towards those appropriate for more knowledge-based economies. CONCLUSIONS, INNOVATIONS, AND RECOMMENDATIONS: Further strengthening comparative advantages in the field of high-tech.