Economic Complexity in Panama: Assessing Opportunities for Productive Diversification

Hausmann, Ricardo; Morales, José Ramón; Santos, Miguel Ángel

doi:10.2139/ssrn.2880643

Cited by 10 publications

(8 citation statements)

References 17 publications

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“…The discovery of a heterogeneous product space has highlighted that externalities and path dependencies are inherent parts of this process (Hausmann and Klinger 2007;Hidalgo et al 2007). The question of whether and how governments can guide this process through industrial policy has therefore gained considerable attention in many developing countries (Hausmann and Chauvin 2015;Hausmann and Klinger 2006a;Hausmann et al, 2014Hausmann et al, , 2016. This question is particularly relevant for Mozambique, whose export structure is undiversified and unsophisticated.…”

Section: Discussionmentioning

confidence: 99%

“…Despite these shortcomings, this paper make two contributions to the literature. We extend the methodology of supply-side-focused economic complexity analysis applied in a number of studies to guide industrial policy in developing countries (Ayres and Freire 2014;Hausmann and Chauvin 2015;Hausmann and Klinger 2006a;Hausmann et al 2014Hausmann et al , 2016Hausmann et al , 2017Hidalgo 2011) with a structured demand-side analysis, ranking products in accordance with their revenue-generating trade potential. Most other studies do not consider demand-side factors at all, and none use gravity models to map the export potential of products and markets.…”

Section: Discussionmentioning

confidence: 99%

“…These countries should follow a strategic bets approach, experimenting with long jumps into well-connected parts of the product space. Thus, these countries should prioritize OGI over distance and PCI (relative to other strategies) (Growth Lab 2020; Hausmann et al 2016). Mozambique, depicted in blue, should follow this strategic bets approach.…”

Section: Choosing a Weighting Schemementioning

confidence: 99%

“…At a more general level, the simulations raises questions about the robustness of the conclusions one can reach by applying a single weighting strategy, and they explain why it is common in the literature to propose a set of different weighting schemes (Hausmann and Chauvin 2015;Hausmann and Klinger 2006a;Hausmann et al 2016Hausmann et al , 2017Hausmann et al , 2019.…”

Section: Robustness Checkmentioning

confidence: 99%

“…Our supply-side analysis follows the methodology employed in a number of studies taking the ideas in economic complexity as a starting point to guide industrial policies in developed and developing countries alike. Examples include policy reports on the Netherlands , South Africa (Hausmann and Klinger 2006a), Rwanda (Hausmann and Chauvin 2015), Jordan (Hausmann et al 2019), Panama (Hausmann et al 2016(Hausmann et al , 2017, Myanmar (Ayres and Freire 2014), Uganda (Hausmann et al 2014), and Southern Africa (Hidalgo 2011). The main objective in these studies is clear: in order to achieve economic growth, countries need to diversify and upgrade their productive structure by acquiring new capabilities.…”

Section: Introductionmentioning

confidence: 99%

See 4 more Smart Citations

Economic complexity and structural transformation: the case of Mozambique

Sørensen¹,

Estmann²,

Sarmento³

et al. 2020

WIDER Working Paper

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Mozambique is among the world’s least complex economies. By systematically accounting for both supply- and demand-side factors, we identify new products and sectors that can help to diversify and upgrade its economy. In a supply-side analysis, we use network methods from the literature on economic complexity to identify a set of target products that are complex, require productive capabilities useful in the export of other products, and are close to Mozambique’s existing productive structure. In a demand-side analysis, we use gravity models to predict the export potential of target products and markets given product-specific trade resistance and geographically dispersed demand. The broad sectoral focus of Mozambique’s industrial policy is largely consistent with structural transformation and export promotion. The current prioritization of agriculture, agro-industry, and metals is especially important, while there are unexploited opportunities in machinery, vehicles, and transport equipment. We find some potential for Mozambique to export target products to neighbouring countries.

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Section: Discussionmentioning

confidence: 99%

Section: Discussionmentioning

confidence: 99%

Section: Choosing a Weighting Schemementioning

confidence: 99%

Section: Robustness Checkmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 3 more Smart Citations

Economic complexity and structural transformation: the case of Mozambique

Sørensen¹,

Estmann²,

Sarmento³

et al. 2020

WIDER Working Paper

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To them that hath: economic complexity and local industrial strategy in the UK

Mealy

Coyle

2021

Int Tax Public Finance

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Divergent economic performance in many countries has led to renewed interest in place-based policies, such as the UK’s local industrial strategies at the level of Combined Authorities or Local Economic Partnerships. However, an analysis of employment data using methods from the economic complexity literature demonstrates great heterogeneity in industrial strengths and future growth opportunities within those jurisdictions, raising challenges in designing common policies suited to all sub-geographies. Moreover, the ‘related’ industries into which low-complexity, low-wage local authorities could potentially diversify are also low-wage. Incremental policies building on existing local capacities are therefore likely to amplify divergence between prospering and left-behind areas.

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