ABSTRACT
Government intervention plays an important role in the changes of a country's comparative advantages. Therefore, when a country participates in the international division of labor in light of its existing comparative advantages, it needs to use national capacity to nurture and promote domestic key industries and constantly develop new comparative advantages so as to enhance international competitiveness. In accordance with the theory of dynamic comparative advantage, the governments of Japan and the 'Four Asian Tigers' – Hong Kong, South Korea, Singapore, and Taiwan – purposefully guided the upgrading of industrial structure and export structure, which enabled the economies to have achieved huge success. The new circumstances call for a shift in China's export strategy from one based on static comparative advantages to one based on dynamic comparative advantages. China needs actively construct a favorable environment for upgrading export structure and enabling capital-intensive exports to become more competitive.
