Pax americana and asian exports: revealed trends of comparative advantage recycling

Abstract

Ever since the end of World War II the U.S. import markets, especially those for labor-intensive standardized manufactures, have been opened up for imports from developing countries in order to assist economic development abroad. The Asian economies, in particular, are the most active exploiters of this trade-as-aid policy of the United States formulated along the free trade doctrine of comparative advantage. As Japan graduated from the early postwar labor-driven exports and moved up to higher phases of industrialization (to scale-driven, assembly-driven, and currently knowledge-driven), other Asian economies, first the newly industrialized economies (NIEs) and then the Association of Southeast Asian Nations (ASEAN) countries and China, have been capturing those low-end U.S. import markets in tandem, thereby creating the phenomenon of comparative advantage recycling. Some revealed patterns are examined.