Measures of similarity and matching in international trade

Abstract

* Peter J. Lloyd 1. INTRODUCTION Finger and Kreinin (1979) devised an index of ‘export similarity’ to calculate the overlap between the distributions of exports by commodity group of two countries to the markets of a third country. As they noted, ‘A number of propositions in international economics can be examined by the use of an index measuring the similarity of the exports of any two countries (or groups of countries) to a third market’ (Finger and Kreinin, 1979, p. 905). They specifically mentioned the situations of non-reciprocal preferences granted by developed countries to developing countries (and therefore not to other developed countries which also exported to the preference-granti..