Economic Complexity Research Articles

Is there a Proven Relationship Between the Economic Complexity of Moroccan Regions and their Well-being?

Is there a Proven Relationship Between the Economic Complexity of Moroccan Regions and their Well-being?

Complexity and FDI in market-dependent economies: The hidden effect of industrial offshoring

AbstractThis study examines the complexity in the Eastern European economies, with a focus on the role of foreign direct investment (FDI). Despite transitioning to market economies, these countries remain economically fragile and dependent. Their lower technological complexity and reliance on foreign capacity make them vulnerable. However, some countries like Austria and Poland demonstrate successful integration of production and innovation. The analysis shows FDI has a limited impact on developing complex knowledge but contributes positively to economic complexity. Results also indicate that in the long-term, economic and technological complexity does not lead to accelerated total factor productivity growth, contrary to complexity literature. Combining labour with innovation, safeguarding local industries, and prioritizing education and research are more effective approaches. The study clearly shows how Hungary is stuck in an “assembler trap.” It also finds that the gap between economic and technological complexity negatively affects liberal democracies.

Analyzing the Influence of Energy Consumption and Economic Complexity on Carbon Emissions: Evidence from Malaysia

Analyzing the Influence of Energy Consumption and Economic Complexity on Carbon Emissions: Evidence from Malaysia

The hidden cost of sophistication: economic complexity and obesity

The hidden cost of sophistication: economic complexity and obesity

Systems dynamics and casual configurations: Using dynamic pattern synthesis for macroeconomic comparative research

Dynamic Pattern Synthesis (DPS) provides a new longitudinal method for evaluating the impacts of macroeconomic and public policy interventions. Situated within complexity theory and critical realism, it has evolved from the established methods of Cluster Analysis and Configurational Modelling approaches. Dynamic Pattern Synthesis identifies case convergence and divergence (using quantitative techniques), while remaining close to the qualitative uniqueness of each case. In this paper, the DPS approach is used to consider macroeconomic convergence across Sub-Saharan Africa during the Millennium Development Goals, and the possible impacts of IMF interventions in stimulating long-term macroeconomic outcomes. The findings reveal a high degree of economic instability experienced across the region and varying responses to an external shock. The importance of ‘outliers’ and inconsistency in country convergence are also observed. The DPS method highlights the importance of individual country experiences in relation to external shocks. When factoring in IMF interventions, the findings highlight multiple paths to a given policy outcome, rather than a single optimal economic strategy. This opens up the debate on policy issues associated with economic complexity, including how best to create an overall environment of stability that might promote convergence and reduce the instability that undermines planning and investment.

Contribution of hydro energy production, economic complexity and technological innovation in achieving an environmentally sustainable Asia

The impact of hydro energy production, economic complexity, urbanization, technological innovation and financial development on environmental sustainability between 1995 and 2017 is examined for a panel of thirteen Asian economies using two environmental proxies— their ecological footprint and CO2 emissions. The non-parametric Driscoll-Kraay standard error method and the Dumitrescu-Hurlin panel causality test are applied to the data. Our findings show that hydro energy production and technological innovation have a significant negative impact on the environment, thus promoting environmental sustainability. Economic complexity significantly lowers environmental sustainability while the non-linear effect of economic complexity favors environmental sustainability; this confirms the existence of an economic-complexity-based inverted-U-shaped environmental Kuznets curve hypothesis. Moreover, urbanization and financial development significantly decrease environmental sustainability. The results of our study confirm the feedback causality between hydro energy production and carbon dioxide emissions. We recommend expansionary policies regarding hydro energy production that are beneficial for substituting fossil fuel energy. This paves a path towards environmental sustainability in this era of global boiling.

Impulsive Response Analysis of Financial Markets in QUAD Economies: A VAR Modelling Approach

Financial market integration remains a key focus in academic finance, especially given how crucial it is to portfolio diversification. The purpose of this research is to investigate a crucial yet underexplored aspect like the cointegration of economies with formal or unofficial military ties, focusing on countries within the Quad strategic forum—India, Japan, Australia, and the United States. The daily closing values of benchmark stock market indices of Quad economies viz. Nikkie 225 for Japan, S&P ASX 200 for Australia, NASDAQ composite for the United States, and S&P Sensex for India were considered. Unit root tests, Johansen Cointegration tests, VAR (Vector Autoregressive) model, and the Granger Causality statistics are computed for data analysis. Additionally, the Impulse response function and variance decomposition are computed for better financial market predictions. The result reveals intriguing dynamics: while the Indian stock market initially responds positively to shocks in the Australian market, this effect diminishes over time. Also, movements in the Australian and United States stock markets significantly contribute to predicting fluctuations in the Indian market, contrasting with the limited predictive power of the Japanese stock market. These findings carry significant practical implications for international investors, offering valuable guidance for optimizing portfolio diversification strategies amidst geopolitical and economic complexities. This paper contributes to academic literature by offering empirical insights into the short-term dynamics and causal relationships of Quad countries’ stock markets, setting a foundation for future studies on long-term trends and market responses to external factors.

Strategi Pendidikan Inovatif Untuk Keterampilan Global Dalam Konteks Generasi Emas 2045

This research aims to explore innovative educational strategies necessary to strengthen global skills in the 2045 Golden Generation. Through an in-depth analysis of the dynamics of social, technological, and global economic complexities, the article identifies substantial challenges in preparing the next generation for a rapidly changing world. Within this context, the study highlights the urgency for a profound transformation in the education system to integrate essential and relevant skills aligned with an increasingly interconnected and diverse world. The research suggests that project-based learning, leveraging advanced technology, and enhancing cross-sectoral collaboration are key to addressing these challenges. Through appropriate technology integration, new opportunities arise to facilitate more adaptive and responsive learning tailored to individual student needs. Furthermore, close collaboration among formal education, industry, and community institutions can provide more contextual and relevant learning experiences. By offering concrete solutions, this research not only provides deep insights into the complexity of challenges facing education but also depicts the transformative potential of innovative education in shaping an inclusive, dynamic, and highly competitive education future. Therefore, this research is relevant to education academics and practitioners and policymakers, industry stakeholders, and the broader community concerned with sustainable and inclusive future development.

Does Economic Complexity Influence Carbon Emissions? Evidence from Next Eleven Countries

Abstract Research Purpose The study examines the effect of economic complexity on carbon dioxide emissions in the Next 11 countries with the view to validate or refute the economic complexity-Kuznets curve (EcKC) between 1995 and 2019. The Next 11 countries include Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, South Korea, Turkey, and Vietnam. Design/Methodology/Approach Two econometric methods, correlated Panel standard error (PCSE) and feasible generalized least squares (FGLS) estimating techniques, are used to achieve the objectives of the study. Findings The estimates from the FGLS approach are consistent with that of the PCSE approach. The results from both techniques show that economic complexity increases carbon emissions in the Next 11 countries. Also, from the EcKC, the study invalidates the hypothesis and supports a positive monotonic linear relationship between economic complexity and carbon emissions, which also means the “pollution haven hypothesis”. Originality/Value/Practical Implications The study examines whether the environmental Kuznets curve (EKC) in the Next 11 countries is valid or not. To do this, the current study is different from earlier studies in that it uses economic complexity—that is, the economic complexity-Kuznets Curve (ECKC)—instead of GDP. This is explained by the fact that environmental issues should involve the development of more advanced commodities rather than just raising an economy's GDP productivity. And most of the countries in the Next 11 countries are currently shifting their economies to produce more complex goods.

The interaction of institutional quality, economic complexity, and carbon dioxide emission: An empirical examination for China and Pakistan

Environmental quality (EQ) emerged as a top priority for the governments of China and Pakistan as both countries are at potential risk of environmental degradation. Therefore, it is critical to identify the factors that adversely affect environmental quality and alleviate the detrimental consequences of global warming. To mitigate the negative consequences of carbon (CO2) emissions in complex environments, institutions play a critical role in sustainable economic development. Thus, this study made a pioneering effort to discover the integrated link between economic complexity (EC) and carbon emissions (CO2) with the interaction of institutional quality (IQ). Furthermore, the study is a unique effort in modeling China and Pakistan in a framework to treasure the better comparison for generalizability of outcomes. Time series analysis was conducted from 1996 to 2021 using the Autoregressive Distributed Lag (ARDL) approach. The results revealed that EC raises emissions over time in China and Pakistan. Due to the disparity in IQ between China and Pakistan, IQ only lowers the risk of emissions in China. However, extremely high emissions evaporate the effect of interventions on environmental quality because both nations are major polluters, IQ has little influence on environmental quality and strengthens the relationship between EC and CO2 while used as an interaction term. Therefore, industries must exploit poor governance in complex countries with limited laws or regulations, resulting in greater carbon emissions. Thus, to reduce greenhouse gases while boosting economic development, policymakers should strengthen institutions, encourage environmentally friendly methods, and foster innovation in technologies with low carbon footprints.

Economic Complexity and National Culture: An Analysis from the Perspective of Income

Resumo As diversas características das dimensões culturais de um país fazem emergir comportamentos coletivos diferentes que impactam nas formas de se viver, na organização do trabalho e na economia. Este estudo investigou as correlações entre as dimensões culturais segundo Hofstede (distância do poder, individualismo-coletivismo, masculinidade-feminilidade, aversão à incerteza, orientação de longo prazo e indulgência-restrição) e os índices de complexidade econômica dos países. Realizou-se uma análise de correlação canônica para determinar a magnitude das relações entre os dois conjuntos de variáveis. Os resultados revelaram correlações significativas entre cultura e complexidade, variando conforme a renda dos países. Características culturais como menor distância do poder, maior individualismo e maior indulgência associaram-se a economias mais complexas, baseadas em inovação e pesquisa científica. Masculinidade-feminilidade e aversão à incerteza não mostraram correlação significativa. Maior orientação de longo prazo correlacionou-se a economias mais diversificadas nas exportações. Essas conclusões podem orientar políticas de desenvolvimento mais eficazes, respeitando particularidades culturais.

Energy Transition, fossil Fuels, and green Innovations: Paving the way to achieving sustainable development Goals in the United States

The United States, as the world's second-largest polluter, emitted a staggering 4.7 billion metric tonnes of carbon dioxide in 2020. During the Leaders’ Climate Summit, the US president articulated precise targets for combating climate change, notably a 50 to 52 percent reduction in net CO2 emissions from 2005 levels by 2030. Consequently, it becomes imperative to identify the pivotal factors that are driving this intensified dedication to achieving the Sustainable Development Goals (SDGs). Hence, it is vibrant to determine the basic causes propelling the intensified interest in meeting SDGs 7 and 13. From this perspective, this study explores the dynamic link between energy transition, fossil fuel energy, green innovation, and economic complexity index on CO2 emissions and ecological footprint in the United States from 1980 to 2020. The dynamic Autoregressive-Distributed Lag (ARDL) simulations and Frequency Domain Causality (FDC) techniques are applied for long-medium and short-run causal association among the variables. Our empirical evidence shows that energy transition, fossil fuel energy, and economic complexity increase CO2 emissions and ecological footprint. On the other hand, green innovation reduces CO2 emissions and ecological impact only in the long term. The pragmatic outcomes suggest that authorities should inhibit Fossil Fuel Energy, concentrate on energy transitions, and include more renewable sources in the US energy mix. The findings would assist the United States in meeting SDGs 7 and 13.

A comparison of economic complexity in Türkiye and OECD countries: new data based on industrial products

A comparison of economic complexity in Türkiye and OECD countries: new data based on industrial products

Revisiting natural resources and economic complexity nexus: Does financial development matter in developing countries?

There is a large body of work documenting the non-consensual effects of natural resources on economic complexity. Despite this extensive literature, little is known about the mediating effect of financial development on the above relation. This paper focuses on assessing the effect of financial development on natural resources and economic complexity nexus. The study uses the System Generalized Method of Moments in a sample of one hundred (100) developing countries over the period of 1995–2020. The results show that natural resources reduce economic complexity; translating the curse of natural resources into economic complexity. However, financial development reduces this curse and thus improves the effect of natural resources on economic complexity. The results remain robust to several robustness and sensitivity tests.

Does economic complexity help in achieving environmental sustainability? New empirical evidence from N-11 countries

In view of the SDGs argued by UNO, it is vital to address the pressing issues regarding sustainable development. The aim of current study is to investigate the impact of economic complexity (ECC) on environmental sustainability. To achieve this aim, we sampled the 25 years of data of Next-11 countries over the period 1995 to 2019. The economic complexity was measured by the economic complexity index (ECI) while environmental sustainability was measured by two proxy variables including CO2 and greenhouse gas (GHG) emissions. The empirical analysis was established by utilizing the unit root test, cointegration test, FMOLS (fully modified OLS) and DOLS (dynamic OLS) models. The estimated coefficient values disclosed that ECC has a negative and statistically significant relationship with both CO2 and GHG emissions in the long run, implying that ECC ensured environmental sustainability. In addition, the analysis reveals that financial development has a negative while economic growth and energy imports have a positive and statistically significant association with both CO2 and GHG emissions. The findings of the current study suggested an important policy regarding the focus on ECC for achieving environmental sustainability in underlying economies. This study provides robustness to the existing literature in alternative data settings (N-11 countries) and by the unique objective of focusing on environmental sustainability.

Mapping job fitness and skill coherence into wages: an economic complexity analysis

Leveraging the discrete skill and knowledge worker requirements of each occupation provided by O*NET, our empirical approach employs network-based tools from the Economic Complexity framework to characterize the US occupational network. This approach provides insights into the interplay between wages and the complexity or relatedness of the skill sets within each occupation, complementing conventional human capital frameworks. Our empirical strategy is threefold. First, we construct the Job and Skill Progression Networks, where nodes represent jobs (skills) and a link between two jobs (skills) indicates statistically significant co-occurrence of skills required to carry out those two jobs, that can be useful tools to identify job-switching paths and skill complementarities Second, by harnessing the Fitness and Complexity algorithm, we define a data-driven skill-based complexity measure of jobs that positively maps, but with interesting deviations, into wages and in the bottom–up and broad abstract/manual and routine/non-routine job characterisations, however providing a continuous and endogenous metric to assess the degree of complexity of each occupational skill-set. Third, building on relatedness and corporate coherence metrics, we introduce a measure of each job’s skill coherence, that negatively maps into wages. Our findings may inform policymakers and employers on designing more effective labour market policies and training schemes, that, rather than fostering hyper-specialization, should favor the acquisition of complex and “uncoherent” skill sets, enabling workers to more easily move throughout the job and skill progression networks and make informed career choices decisions while unlocking higher wage opportunities.

Moderating roles of technological innovation and economic complexity in financial development-environmental quality nexus of the BRICS economies

The aspects of globalization are certainly not without economic-related opportunities especially in the developing countries such as Brazil, Russia, India, China, and South Africa (BRICS). By employing the cross-sectionally augmented autoregressive distributed lag among other empirical approaches over the period 1995–2017, the following critical results are presented by the investigation. Economic complexity, technological innovation, and financial development all yield desirable outlook toward carbon emission mitigation in the countries while economic growth further shows short- and long-run detrimental effect on environmental quality. Moreover, the combined effect of financial development and economic complexity has no significant effect on carbon emission in the short- and long-run while also neutralizing the direct environmental effect of financial development. Additionally, technological innovation moderate financial development to further mitigate carbon emission, thus justifying the direct and indirect environmental effects of technological innovation. Meanwhile, negative environmental effect of economic growth remained unabated in the entire scenario. This result emphasizes the role of environmental-related technologies transfer in improving the bloc's environmental sustainability.

Understanding the nexus: economic complexity and environmental degradation in Sub-Saharan Africa

Understanding the nexus: economic complexity and environmental degradation in Sub-Saharan Africa

Economic complexity, greenfield investments, and energy innovation: policy implications for sustainable development goals in newly industrialised economies.

The crucial role of environmental assessment quality has been recognised by environmental and sustainable development goals in addressing climate change challenges. By focusing on the key identifier of environmental assessment, progress can be made towards overcoming climate change issues effectively. The current study considers environmental commitments under COP28 to study the role of economic complexity, greenfield investments, and energy innovation in environmental degradation in newly industrialised economies from 1995 to 2021. We employ novel panel estimations from CS-ARDL, CS-DL, AMG, and CCEMG to confirm that economic growth and greenfield investments degrade environmental quality. On the other hand, energy innovation and urbanisation improve environmental sustainability. Lastly, we confirm the EKC hypothesis for economic complexity as well. Given the reported empirical findings, the study suggests policymakers must focus on economic complexity to transform industrial sectors' economic potential. Furthermore, foreign investment projects must be linked with environmental goals to increase renewable energy capacity.

Territorial Organisation of the Resort “Yaremche” in the Nadvirna District of the Ivano-Frankivsk Region

Topicality. The Ukrainian Carpathians (a part of the Eastern Carpathians in Ukraine) are among the best ones in the country in terms of recreational sphere development. Many years of experience in the field of recreation is an important prerequisite for its recognition as a priority in the economic complex of the region. The strategic goal of the development of any territory is to create a stable territorial-recreation system, optimally using natural, labour, material, technical, and other resources. This, in turn, will ensure the material well-being of the local population without disturbing the ecological balance in the Carpathian region. The aim of the article is to implement the territorial organisation of the resort “Yaremche” with the help of information technologies. Research methods. Both general scientific and special methods are used in this study. The basis of resort area zoning are information technologies and mapping methods, such as Autocad xb MapInfo, Digitals, Delta, Google Maps, and Virtual Earth, Google Earth Pro, and Open Streer Map. Digitisation of land covers are carried out according to their display on online satellite images in the Digitals program. Results. The territorial organisation of the resort “Yaremche” is carried out with the help of information technologies. The allocation of each of the 13 zones with a total area of 11,313.897 hectares is substantiated: Carpathian National Nature Park Reserve Zone – 509.2448 hectares; Rivers Zone – 64.8532 hectares; Zone of Coastal Protection – 304.4698 hectares; Zone of Regulated Recreation of Carpathian National Nature Park – 2028.1494 hectares; Recreational Zone – 101.9866 hectares; Zone of Public Green Spaces – 18.7594 hectares; Zone of Other Green Areas – 623.9729 hectares; Zone of skiing tracks – 81.1291 hectares; Zone of Service Centres of Mountain Recreation Complexes – 18.9858 hectares; Land Area of Settlements (buildings) – 1183.7419 hectares; Zone of Recreational Forests of Dora Forestry of Delyatyn FI – 1746.3541 hectares; The zone of exploitation forests, other forest and non-forest lands of Dora Forestry of Deliatyn FA (Forestry Administration) – 4074.65 hectares; Zone of Exploitation Forests, Other Forest and Non-forest lands of Yaremche Nature Protection Scientific Research Department of Carpathian National Nature Park – 557.6 hectares. Conclusions and discussion. The effectiveness of this research consists in optimising the use of the territory of the resort “Yaremche”. This will make it possible to improve its social efficiency, expand the medical facilities of the Ukrainian Carpathians, and improve the economic performance of the region.