An Analysis of Trade Specialization in Bangladesh, 1996-2011

Trade specialization has been studied extensively, and many researchers try to explain the patterns of specialization and the different factors that determine it. By using the Revealed Symmetric Comparative Advantage Index and the Galtonian Regression Technique, this study tries to define the industries with trade specialization and analyze the transformation of the pattern of trade specialization in Bangladesh in the period 1996-2011 to show how the export and import specialization of industries changed and to what extent the design of trade specialization in Bangladesh has been transformed during the last sixteen years. Empirical analysis showed that the export of Bangladesh consists mainly of the garment industry, and Bangladesh's import products essentially belong to the category of commodities for further production and the support of the exporting sector. From the Galtonian regression analysis of export and import specialization, it has been found that the level of export diversification is deficient and relatively stable, which is confirmed by the low mobility effect. Bangladesh’s export specialization pattern is highly concentrated only in apparel products throughout the study period. All other sectors contribute significantly less in total export share, but the import is more diversified. For the country's development, it must diversify its export basket.