Extending Economic Complexity Index to a Ternary Complexity Index
26 Pages Posted: 20 Nov 2017
Date Written: November 16, 2017
Economic complexity measures have been constructed on the basis of bilateral country-product network data. In this study, we submit a Ternary Complexity Index (TCI), which explicitly incorporates technological complexity as a third dimension, measured in terms of patents. TCI is based on Lotka-Volterra equations and thus the evolution of an innovation eco-system can be specified unambiguously. We perform model calculations based on empirical data and simulate the diachronic extensions. The results suggest that TCI improves on Hidalgo & Hausmann’ and Tacchella et al. measures as an indicator of future economic growth.
Keywords: economic complexity; metrics; triple helix; eco-system; simulation
JEL Classification: C6; O4
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