An Account of Global Intra-industry Trade, 1962–2006

M ERCHANDISE trade is by far the best documented aspect of international economic relations. Trade data therefore offer a rich source of information on patterns and shifts in the allocation of economic activity around the globe. In this paper I describe global merchandise trade flows through the lens of intra-industry trade (IIT) indices, which quantify the extent to which bilateral imports and exports are matched within sectors. A simple description of IIT patterns is of interest for two main purposes: as a gauge of the sectoral similarity of different national economies, and as a proxy for the intensity of factor-market adjustment pressures associated with trade expansion. It is easy to see how IIT can serve as an indicator of economic similarity: for two countries to be able to export goods of a particular sector to each other, they both need to produce this good. 1 Given the relative paucity of internationally