
doi: 10.2307/2232173
In the September I98I issue of this JOURNAL, Richard Pomfret examines the similarity of non-oil, non-manufactured exports to the EEC from the three recent or prospective entrants (Spain, Greece and Portugal hereafter 'the Three') and from eleven other non-member Mediterranean countries., The technique used by Pomfret is an application of the newly articulated Similarity Index (S)2 and is of interest for its practical application in many areas of trade and trade-policy analysis. As the EEC (or any customs union) expands, for example, its potential for trade diversion expands accordingly. Until recently, economic analysis tended to focus on associated costs from the common market's perspective, rarely identifying the specific non-members principally affected or likely to be affected by the changed scope of the customs union. The Similarity Index lends itself well to precisely such expanded analysis. Because of the potentially wide applicability inherent in this technique, it is important to examine two questions, the answers to which may critically affect the usefulness of the technique. These are: How stable are the similarity ratios over time? How stable are the similarity indices and the associated country rankings at various levels of commodity aggregations?
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