Related papers: The Theory of Economic Complexity
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…
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,…
Economic complexity measures aim to quantify the capability content or endowment of industries and territories; however, capabilities are not observable, and therefore cannot be directly used in the computations. We estimate such endowments…
Economic complexity algorithms aim to uncover the hidden capabilities that drive economic systems. Here, we present a fundamental reinterpretation of two of these algorithms, the Economic Complexity Index (ECI) and the Economic Fitness and…
How much knowledge is there in an economy? In recent years, data on the mix of products that countries export has been used to construct measures of economic complexity that estimate the knowledge available in an economy and predict future…
Two network measures known as the Economic Complexity Index (ECI) and Product Complexity Index (PCI) have provided important insights into patterns of economic development. We show that the ECI and PCI are equivalent to a spectral…
Estimating the capabilities, or inputs of production, that drive and constrain the economic development of urban areas has remained a challenging goal. We posit that capabilities are instantiated in the complexity and sophistication of…
Development and growth are complex and tumultuous processes. Modern economic growth theories identify some key determinants of economic growth. However, the relative importance of the determinants remains unknown, and additional variables…
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…
Recently we uploaded to the arxiv a paper entitled: Improving the Economic Complexity Index. There, we compared three metrics of the knowledge intensity of an economy, the original metric we published in 2009 (the Economic Complexity Index…
Contrary to conventional economic growth theory, which reduces a country's output to one aggregate variable (GDP), product diversity is central to economic development, as recent 'economic complexity' research suggests. A country's product…
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…
A country's mix of products predicts its subsequent pattern of diversification and economic growth. But does this product mix also predict income inequality? Here we combine methods from econometrics, network science, and economic…
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…
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…
Recently a measure for Economic Complexity named ECI+ has been proposed by Albeaik et al. We like the ECI+ algorithm because it is mathematically identical to the Fitness algorithm, the measure for Economic Complexity we introduced in 2012.…
The Economic Complexity Index (ECI; Hidalgo & Hausmann, 2009) measures the complexity of national economies in terms of product groups. Analogously to ECI, a Patent Complexity Index (PatCI) can be developed on the basis of a matrix of…
China has experienced an outstanding economic expansion during the past decades, however, literature on non-monetary metrics that reveal the status of China's regional economic development are still lacking. In this paper, we fill this gap…
Initially designed to predict and explain the economic trajectories of countries, cities, and regions, economic complexity has been found applicable in diverse contexts such as ecology and chess openings. The success of economic complexity…
We develop a dynamic model of economic complexity that endogenously generates a transition between unconditional and conditional convergence. In this model, convergence turns conditional as the capability intensity of activities rises. We…