Related papers: Variety, Complexity and Economic Development
Against the background of renewed interest in vertical support policies targeting specific industries or technologies, we investigate the effects of vertical vs. horizontal policies in a combinatorial model of economic development. In the…
For Adam Smith, wealth was related to the division of labor. As people and firms specialize in different activities, economic efficiency increases, suggesting that development is associated with an increase in the number of individual…
Economic complexity - a group of dimensionality-reduction methods that apply network science to trade data - represented a paradigm shift in development economics towards materializing the once-intangible concept of capabilities as…
The evolution of economic and innovation systems at the national scale is shaped by a complex dynamics, the footprint of which is the nested structure of the activities in which different countries are competitive. Nestedness is a…
We develop a machine-learning-based method, Principal Smooth-Dynamics Analysis (PriSDA), to identify patterns in economic development and to automate the development of new theory of economic dynamics. Traditionally, economic growth is…
Economic complexity reflects the amount of knowledge that is embedded in the productive structure of an economy. It resides on the premise of hidden capabilities - fundamental endowments underlying the productive structure. In general,…
Poor economies not only produce less; they typically produce things that involve fewer inputs and fewer intermediate steps. Yet the supply chains of poor countries face more frequent disruptions---delivery failures, faulty parts, delays,…
Economic growth is often associated with diversification of economic activities. Making a product in a country is dependent on having, and acquiring, the capabilities needed to make the product, making the process path-dependent. We derive…
We use a simple combinatorial model of technological change to explain the Industrial Revolution. The Industrial Revolution was a sudden large improvement in technology, which resulted in significant increases in human wealth and life…
Classic economic science is reaching the limits of its explanatory powers. Complexity science uses an increasingly larger set of different methods to analyze physical, biological, cultural, social, and economic factors, providing a broader…
Much of the analysis of economic growth has focused on the study of aggregate output. Here, we deviate from this tradition and look instead at the structure of output embodied in the network connecting countries to the products that they…
Efforts to apply economic complexity to identify diversification opportunities often rely on diagrams comparing the relatedness and complexity or products, technologies, or industries. Yer, the use of these diagrams is not based on…
In economic literature, economic complexity is typically approximated on the basis of an economy's gross export structure. However, in times of ever increasingly integrated global value chains, gross exports may convey an inaccurate image…
Economic growth results from countries' accumulation of organizational and technological capabilities. The Economic and Product Complexity Indices, introduced as an attempt to measure these capabilities from a country's basket of exported…
We develop a two-region economic geography model with vertical innovations that improve the quality of manufactured varieties produced in each region. The chance of innovation depends on the \emph{related variety}, i.e. the importance of…
Knowhow in societies accumulates as it gets transmitted from group to group, and from generation to generation. However, we lack of a unified quantitative formalism that takes into account the structured process for how this accumulation…
Economic complexity reflects the amount of knowledge that is embedded in the productive structure of an economy. By combining tools from network science and econometrics, a robust and stable relationship between a country's productive…
Diversity is a fundamental feature of ecosystems, even when the concept of ecosystem is extended to sociology or economics. Diversity can be intended as the count of different items, animals, or, more generally, interactions. There are two…
Economic transformation -- change in what an economy produces -- is foundational to development and rising standards of living. Our understanding of this process has been propelled recently by two branches of work in the field of economic…
To achieve inclusive green growth, countries need to consider a multiplicity of economic, social, and environmental factors. These are often captured by metrics of economic complexity derived from the geography of trade, thus missing key…