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Growth dynamics and complexity of national economies in the global trade network

Author: Attilio Stella

Abstract

The talk will present recent work (*) exploring the quantitative nexus among economic growth of a country, diversity and specialization of of its productions, and evolution in time of its basket of exports. Relying on panel data of 1238 exports from 223 countries during 21 years, for this exploration we set up a stochastic dynamic model and construct suitable economic complexity measures. Key statistical features pertaining to the distribution of resources in the various exports of each country reveal essential for both purposes. Parameters entering the evolution model, combined with counterfactual analyses, give insight into cooperative effects among different productions and prospects of growth of each economy. Complexity features emerging from the analysis of dynamics are usefully compared with GDPpc data and with an original measure of efficiency of economic systems. Using tools of information theory, this measure is made fully consistent with the degree of specialization of the products. Comparisons of this measure with dynamic model parameters allow clear distinctions, from multiple perspectives, among developed, emerging, underdeveloped, and risky economies.