Fundamental Versus Granular Comparative Advantage: An Analysis Using Chess Data

Abstract

Summary The Ricardian and Heckscher‐Ohlin models of international trade contend that firms do not play any role in shaping countries' export specialization. However, the evidence shows that few firms dominate exports in many countries. This paper analyzes the relative contribution of fundamental (country) and granular (individual) comparative advantage to the differences in specialization across countries in a particular activity: chess. Using data on the quality of around 146,000 chess players in 106 countries in 2015, I find that fundamental comparative advantage is the main contributor to the variation in countries' specialization in chess. However, the contribution of granular comparative advantage becomes larger when analyzing specialization in very high‐quality chess players. Despite the appearance of chess servers that allow playing online and offer tools to improve chess skills, I do not find convergence in fundamental comparative advantage over the period 2001‐2015.

The influence of schooling on performance in chess and at the Olympics

“…Even so, at the Olympics, there is still a residual direct role for income in accounting for the distribution of medals. Again though this may feed back to the sources of comparative advantage proposed by Minondo ( 2017 ). Some Olympic sports are very expensive for participants.…”

“…Prior literature on the economics of chess is scarce and has focused primarily on applications of game theory. However, Minondo ( 2017 ) analyses Elo ratings for 146,000 chess players from 106 countries in 2015. Considering levels of achievement reached by players from different federations, he identifies country comparative advantage as a factor driving patterns in levels of achievement of individual players and demonstrates a strong correlation with several proxies for the popularity of the sport by country.…”

“…In identifying countries with comparative advantage in chess, based on individual player ratings, Minondo ( 2017 ) identified the sources of advantage as twofold: the number of players drawn to chess and the opportunities to practice and improve chess skills. Given that initiation of chess is likely often to be in a school setting, his conclusion is not inconsistent with our finding that greater exposure to schooling in the population is associated with greater success in the Chess Olympiad.…”

AI, ageing and brain-work productivity: Technological change in professional Japanese chess

“…From 1968, information on games was accumulated. In previous Chess studies, the Elo rating is generally used to measure individual player’s strength [ 24 , 29 , 30 ].…”