INVESTIGATION OF THE RELATIONSHIP BETWEEN ECONOMIC COMPLEXITY LEVEL AND HUMAN DEVELOPMENT LEVEL: COMPARISON OF DEVELOPED AND DEVELOPING COUNTRIES
Abstract
Purpose- The purpose of this study is to examine whether there is a difference between developed and developing countries in terms of the relationship between economic complexity level and human development level. Examining whether there is a long-term relationship between these two variables constitutes the main motivation of the study.
Methodology- In the present study, Bai and Carrion-I-Silvestre cointegration test has been applied to the data for G20 countries within the period from 1992 to 2017.
Findings- For all countries except the US, HDI has an impact on the ECI. The impact of HDI on ECI is negative in Germany, France, United Kingdom, Italy and Japan while it is positive in other countries. According to these results; in developed countries except Canada and Australia, human development has a negative impact on economic complexity level.
Conclusion- Results mean that improvements in indicators such as education, health, etc. in developing G20 countries develop human development level, and this development increases the sophistication of the economy; the quality of the products produced and exported by countries is developing to reflect the ability to use more complex knowledge together.
Keywords
Economic complexity level human development level panel data analysiss panel cointegration analysis
References
- Bai, J., & Carrion-i-Silvestre, J.L. (2013). Testing panel cointegration with unobservable dynamic common factors that are correlated with the regressors. Econometrics Journal, 16: 222-249.
- Berber, M. (2011). İktisadi büyüme ve kalkınma. Trabzon: Derya Kitabevi.
- Eberhardt, M., & Bond, S. (2009). Cross-section dependence in nonstationary panel models: A novel estimator. MPRA, 17870.
- Ferraz, D., Moralles, H.F. Campoli, J.S., Riberio de Oliviera, F.C., & Aparecida do Nascimento Rebelatto, D. (2018). Economic complexity and human development: DEA performance measurement in Asia and Latin America. Gestão & Produção, 25(4): 839-853.
- Gala, P., Rocha, I.,& Magacho, G. (2018). The structuralist revenge: Economic complexity as an important dimension to evaluate growth and development. Brazilian Journal of Political Economy , 38(2): 219-236.
- Hartmann, D. (2014). Economic Complexity and Human Development. New York: Routledge.
- Hartmann, D., Guevara, M.R., Jara-Figueroa, C., Aristaran, M., & Hidalgo, C.A. (2017). Linking economic complexity, instutions and income inequality. World Development , 93: 75-93.
- Hausmann, R., Hidalgo, C.A., Bustos, S., Coscia, M., Chung, S., Jimenez, J., Simoes, A., & Yildirim, M.A. (2011). The atlas of economic complexity mapping paths to prosperity.
- Hidalgo, C. A. (2009). The dynamics of economic complexity and the product space over a 42 year period. Center for International Development at Harvard University Working Paper 189.
- Hidalgo, C. A.,& and Hausmann, R. (2009). The Building Blocks of Economic Complexity. PNAS, 106 (26): 10570-10575.
- Lapatinas, A. (2016). Economic complexity and human development: A note. Economics Bulletin, 36(3): 1441-1452.
- Pan, C.l., Chang, T., & Wolde-Rufael, Y. (2015). Military spending and economic growth in the Middle East countries: Bootstrap panel causality test. Defence and Peace Economics, 26(24): 443-456.
- Pesaran, M. H. (2004). General diagnostic tests for cross section dependence in panels. CWPE, 0435.
- Pesaran, M. H. (2007). A simple panel unit root test in the presence of cross-section dependence. Journal of Applied Econometrics, 22: 265-312.
- Stojkoski, V., & Kocarev, L. (2017). The relationship between growth and economic complexity: Evidence from Southeastern and Central Europe. MPRA, 77837.
- Şak, N. (2015). Panel Eşbütünleşme Analizi. In Stata ile Panel Veri Modelleri. Ed.by Burak Güriş, İstanbul: Der Yayınları.
- UN. (2019, March 3). Country Classification. Retreived from https://www.un.org/en/development/desa/policy/wesp/wesp_current/2014wesp_country_classification.
- UNDP. (1990). Human Development Report 1990, New York: Oxford University Press.
- Yerdelen Tatoğlu, F. (2013). İleri Panel Veri Analizi Stata Uygulamalı. (2. b.). İstanbul: Beta.
Abstract
References
- Bai, J., & Carrion-i-Silvestre, J.L. (2013). Testing panel cointegration with unobservable dynamic common factors that are correlated with the regressors. Econometrics Journal, 16: 222-249.
- Berber, M. (2011). İktisadi büyüme ve kalkınma. Trabzon: Derya Kitabevi.
- Eberhardt, M., & Bond, S. (2009). Cross-section dependence in nonstationary panel models: A novel estimator. MPRA, 17870.
- Ferraz, D., Moralles, H.F. Campoli, J.S., Riberio de Oliviera, F.C., & Aparecida do Nascimento Rebelatto, D. (2018). Economic complexity and human development: DEA performance measurement in Asia and Latin America. Gestão & Produção, 25(4): 839-853.
- Gala, P., Rocha, I.,& Magacho, G. (2018). The structuralist revenge: Economic complexity as an important dimension to evaluate growth and development. Brazilian Journal of Political Economy , 38(2): 219-236.
- Hartmann, D. (2014). Economic Complexity and Human Development. New York: Routledge.
- Hartmann, D., Guevara, M.R., Jara-Figueroa, C., Aristaran, M., & Hidalgo, C.A. (2017). Linking economic complexity, instutions and income inequality. World Development , 93: 75-93.
- Hausmann, R., Hidalgo, C.A., Bustos, S., Coscia, M., Chung, S., Jimenez, J., Simoes, A., & Yildirim, M.A. (2011). The atlas of economic complexity mapping paths to prosperity.
- Hidalgo, C. A. (2009). The dynamics of economic complexity and the product space over a 42 year period. Center for International Development at Harvard University Working Paper 189.
- Hidalgo, C. A.,& and Hausmann, R. (2009). The Building Blocks of Economic Complexity. PNAS, 106 (26): 10570-10575.
- Lapatinas, A. (2016). Economic complexity and human development: A note. Economics Bulletin, 36(3): 1441-1452.
- Pan, C.l., Chang, T., & Wolde-Rufael, Y. (2015). Military spending and economic growth in the Middle East countries: Bootstrap panel causality test. Defence and Peace Economics, 26(24): 443-456.
- Pesaran, M. H. (2004). General diagnostic tests for cross section dependence in panels. CWPE, 0435.
- Pesaran, M. H. (2007). A simple panel unit root test in the presence of cross-section dependence. Journal of Applied Econometrics, 22: 265-312.
- Stojkoski, V., & Kocarev, L. (2017). The relationship between growth and economic complexity: Evidence from Southeastern and Central Europe. MPRA, 77837.
- Şak, N. (2015). Panel Eşbütünleşme Analizi. In Stata ile Panel Veri Modelleri. Ed.by Burak Güriş, İstanbul: Der Yayınları.
- UN. (2019, March 3). Country Classification. Retreived from https://www.un.org/en/development/desa/policy/wesp/wesp_current/2014wesp_country_classification.
- UNDP. (1990). Human Development Report 1990, New York: Oxford University Press.
- Yerdelen Tatoğlu, F. (2013). İleri Panel Veri Analizi Stata Uygulamalı. (2. b.). İstanbul: Beta.
Details
| Primary Language | English |
|---|---|
| Subjects | Business Administration |
| Journal Section | Articles |
| Authors | |
| Publication Date | September 30, 2019 |
| Published in Issue | Year 2019 Volume: 6 Issue: 3 |
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