The new paradigm of economic complexity

Economic complexity offers a potentially powerful paradigm to understand key societal issues and challenges of our time. The underlying idea is that growth, development, technological change, income inequality, spatial disparities, and resilience are the visible outcomes of hidden systemic interactions. The study of economic complexity seeks to understand the structure of these interactions and how they shape various socioeconomic processes. This emerging field relies heavily on big data and machine learning techniques. This brief introduction to economic complexity has three aims. The first is to summarize key theoretical foundations and principles of economic complexity. The second is to briefly review the tools and metrics developed in the economic complexity literature that exploit information encoded in the structure of the economy to find new empirical patterns. The final aim is to highlight the insights from economic complexity to improve prediction and political decision-making. Institutions including the World Bank, the European Commission, the World Economic Forum, the OECD, and a range of national and regional organizations have begun to embrace the principles of economic complexity and its analytical framework. We discuss policy implications of this field, in particular the usefulness of building recommendation systems for major public investment decisions in a complex world.     

The economic impacts of academic spin-off companies, and their implications for public policy

The importance of academic research (“AR”) to economic growth is widely accepted but quantification of incremental impacts, and their attribution to any one country's expenditures, is difficult. Yet quantitative justification of government AR funding is highly desirable. We therefore attempt to quantify one impact which can be directly and causally attributed to one country's funding: spin-off companies. We focus on AR in the non-medical natural sciences and engineering (NSExm) in a whole country, Canada. ‘Applied’ disciplines are sometimes assumed to be the most commercializable, so we also separately investigate an especially ‘basic’ science, physics. Using a novel methodology, we estimate the lifetime impacts of companies spun-off directly from AR performed in 1960-1998, and compare the impacts with all government funding, direct and indirect, over the same period. This picks up virtually all funding and most company-formation since WWII, up to 1998. Such long-term studies are rare but essential, since we show that successful spin-offs grow (often exponentially) over several decades.With very conservative assumptions, and allowing for the time value of money, the impacts exceed government funding by a substantial margin. Physics actually fares 30-60% better than the combined NSExm; this reflects more successful companies, rather than greater numbers, and therefore does not seem inconsistent with earlier studies on company numbers. Firm lifetimes are long, with Canadian impacts truncated primarily by some foreign acquisitions.We argue that the spin-off impacts represent incremental contributions to GDP, much larger (even on a time-discounted basis) than the government funding and directly attributable to it; governments will also receive more in additional tax than they spent. The impacts therefore provide a quantitative justification for the public investment, allowing the much more important (but less quantifiable) long-term benefits to be regarded as a ‘free’ bonus. The very good showing of physics also suggests that reduced emphasis on basic work or on the basic disciplines could actually weaken the commercialization of AR.     

Reprint of The new paradigm of economic complexity

Economic complexity offers a potentially powerful paradigm to understand key societal issues and challenges of our time. The underlying idea is that growth, development, technological change, income inequality, spatial disparities, and resilience are the visible outcomes of hidden systemic interactions. The study of economic complexity seeks to understand the structure of these interactions and how they shape various socioeconomic processes. This emerging field relies heavily on big data and machine learning techniques. This brief introduction to economic complexity has three aims. The first is to summarize key theoretical foundations and principles of economic complexity. The second is to briefly review the tools and metrics developed in the economic complexity literature that exploit information encoded in the structure of the economy to find new empirical patterns. The final aim is to highlight the insights from economic complexity to improve prediction and political decision-making. Institutions including the World Bank, the European Commission, the World Economic Forum, the OECD, and a range of national and regional organizations have begun to embrace the principles of economic complexity and its analytical framework. We discuss policy implications of this field, in particular the usefulness of building recommendation systems for major public investment decisions in a complex world.     

A simple measure of economic complexity

Contrary to conventional economic growth theory, which reduces a country's output to one aggregate variable (GDP), product diversity is central to economic development, as recent “economic complexity” research suggests. A country's product diversity reflects its diversity of knowhow or “capabilities”. Researchers proposed the Economic Complexity Index (ECI) and the country Fitness index to estimate a country's number of capabilities from international export data; these measures predict economic growth better than conventional variables such as human capital. This paper offers a simpler measure of a country's knowhow, Log Product Diversity (or LPD, the logarithm of a country's number of products), which can be derived from a one-parameter combinatorial model of production in which a set of knowhows combine with some probability to turn raw materials into a product. ECI and log-fitness can be interpreted theoretically (using the combinatorial model) and empirically as potentially noisy estimates of LPD; moreover, controlling for natural resources, the simple measure better explains the cross-country differences in GDP and in GDP per capita.     

Variety,complexity and economic development

We propose a combinatorial model of economic development. An economy develops by acquiring new capabilities allowing for the production of an ever greater variety of products with an increasing complexity. Taking into account that economies abandon the least complex products as they develop over time, we show that variety first increases and then decreases in the course of economic development. This is consistent with the empirical pattern known as ‘the hump’. Our results question the common association of variety with complexity. We further discuss the implications of our model for future research.     

The policy implications of the globalisation of innovation

The paper develops a taxonomy of the globalisation of innovation based on three categories: (a) the international exploitation of technology produced on a national basis; (b) the global generation of innovations; (c) the global technological collaborations. The most evident changes implied by the increasing globalisation of innovation and technology are the tougher and increased competition and the greater collaboration between actors, both across and within national boundaries. The advantages, just as the costs, of these tendencies can be substantial, leading to a higher risk of `winners and losers'. The paper analyses the different impact that each category might have on the economic and innovative performance of countries and regions, with the aim of defining the implications for national policies. It is suggested that public policies play a different role in each of the three processes of the globalisation of innovation and that a single strategy does not exist, neither from a firm's nor from a government's perspective. The paper emphasis that none of the three categories in this taxonomy renders national policy obsolete. On the contrary, public policies are necessary on a far wider range than those currently implemented in the majority of countries.     

Technological complexity and economic growth of regions

One the one hand, complex technologies offer substantial economic benefits, and on the other, they are difficult to invent and to imitate, and they refuse a fast dissemination. This two-sidedness motivates the idea that regions’ competitive advantages and, in consequence, their economic growth, originate in their ability to produce and utilize complex technologies. However, the relationship between technological complexity and regional economic growth has rarely been empirically investigated. Here, we address this pressing research gap by assessing the complexity of technological activities in 159 European NUTS 2 regions and relating it to their economic growth from 2000 to 2014. Our empirical results suggest that technological complexity is an important predictor of regional economic growth. A 10% increase in complexity is associated with a 0.45% GDP per capita growth. By showing that technological complexity is important for regional economic growth, our results fuel current policy debates about optimal regional policies such as the Smart Specialization strategy.     

Birthplace diversity and economic complexity: Cross-country evidence

We empirically investigate the relationship between a country’s economic complexity and the diversity in the birthplaces of its immigrants. Our cross-country analysis suggests that countries with higher birthplace diversity by one standard deviation are more economically complex by 0.1 to 0.18 standard deviations above the mean. This holds particularly for diversity among highly educated migrants and for countries at intermediate levels of economic complexity. We address endogeneity concerns by instrumenting diversity through predicted stocks from a pseudo-gravity model as well as from a standard shift-share approach. Finally, we provide evidence suggesting that birthplace diversity boosts economic complexity by increasing the diversification of the host country’s export basket.     

奥巴马时代的能源政策及启示

美国头号能源消费大国的地位,决定了其能源政策必将对世界产生深远的影响。因此,深入研究奥巴马时代的能源政策,并分析其对世界能源生产和消费、能源发展趋势可能产生的影响就显得十分必要,这对于当今中国能源相关政策的制定也具有一定的参考意义。     

CDMA技术创新过程的特点及其政策启示

从民用扩频通信的兴起、CDMA技术标准的最初确立，到CDMA技术标准的不断演进，CDMA的技术创新过程表现出主体多元性、多进程性和阶段性的特点。主体多元性是指CDMA的技术创新涉及军方、大学、企业和中介机构等多元主体的相互作用；多进程性是指CDMA创新过程包含了从基础研究到商业应用、从军用技术到民用技术溢出的过程；阶段性则表明，CDMA的创新过程由军方、大学主导的根本性创新和企业主导的渐进性创新两个阶段组成。以演化框架分析CDMA的技术创新过程，其政策启示是：要以提高创新系统整体效能为政策基点。具体政策主要包括两个方面：构筑有利于多种主体间相互作用的制度安排和基础设施。     

经济政策不确定性对研发投资平滑的影响研究

   研发投资平滑是企业在不确定条件下维持研发持续性、规避调整成本的策略性行为。鉴于中国转轨经济特征下企业对经济政策具有的高度敏感性,考察经济政策不确定性与企业研发投资平滑关系,对理解经济政策不确定环境下企业研发投资动态特征具有重要意义。文章利用沪深A股上市公司经验数据,运用面板模型考察经济政策不确定性对企业研发投资平滑的影响。结果显示：（1）经济政策不确定性上升对企业研发投资平滑产生了强化作用;（2）与国有企业、高市场化水平地区企业相比,这种强化作用在民营企业、低市场化水平地区企业中表现得更为明显。本文丰富和拓展了经济政策不确定性及研发投资平滑领域研究,为高度经济政策不确定性环境下保障企业研发创新持续性提供有益启示。     

The creation of spin-off firms at public research institutions: Managerial and policy implications

We consider the managerial and policy implications of the rise of spin-offs at public research institutions (PRIs), based on a knowledge-based view (KBV) of the firm. This framework highlights the importance of knowledge in the creation and development of spin-offs. We argue that in order to understand the development of spin-offs, researchers should focus on “knowledge gaps” these new ventures encounter. Knowledge gaps can occur at different levels of aggregation, including the PRI, spin-off, team, individual, incubator, and at different stages of spin-off development. Based on this framework, we synthesize findings from previous studies and papers in the special issue and offer some suggestions for additional research on spin-offs from PRIs.     

The skill bias effect of technological and organisational change: Evidence and policy implications

Previous studies have suggested that technological change is the main cause of the recent increase in demand for highly skilled workers in developed countries. However, a more recent strand of literature has also introduced the “Skill Biased Organisational Change” hypothesis, according to which the increasing diffusion of new organisational practices within firms plays a role in the increasing demand for skilled workers. We estimate a SUR model for a sample of 400 Italian manufacturing firms, showing that upskilling is more a function of reorganisational strategy than a consequence of technological change alone. Moreover, some evidence of superadditive effects emerges, which is consistent with the notion that technology and organisation jointly affect the demand for labour.     

特殊优惠金融政策与经济发展相关性实证研究

党中央多次赋予西藏执行特殊优惠的金融政策，促进了西藏经济的发展。为研究特殊优惠金融政策与西藏经济发展的关系，本文简要回顾了1980年以来中央赋予西藏的特殊优惠金融政策，全面分析特殊优惠金融政策的效应问题，提出在今后一段时期内西藏仍然需要实行特殊优惠金融政策的建议。     

Rickety numbers: Volatility of university rankings and policy implications

The most popular world university rankings are routinely taken at face value by media and social actors. While these rankings are politically influential, they are sensitive to both the conceptual framework (the set of indicators) and the modelling choices made in their construction (e.g., weighting or type of aggregation). A robustness analysis, based on a multi-modelling approach, aims to test the validity of the inference about the rankings produced in the Academic Ranking of World Universities (ARWU) of Shanghai Jiao Tong University and those produced by the UK's Times Higher Education Supplement (THES). Conclusions are drawn on the reliability of individual university ranks and on relative country or macro regional performance (e.g., Europe versus USA versus China) in terms of the number of top performing institutions. We find that while university and country level statistical inferences are unsound, the inference on macro regions is more robust. The paper also aims to propose an alternative ranking which is more dependant on the framework than on the methodological choices.     

National Systems of Entrepreneurship: Measurement issues and policy implications

We introduce a novel concept of National Systems of Entrepreneurship and provide an approach to characterizing them. National Systems of Entrepreneurship are fundamentally resource allocation systems that are driven by individual-level opportunity pursuit, through the creation of new ventures, with this activity and its outcomes regulated by country-specific institutional characteristics. In contrast with the institutional emphasis of the National Systems of Innovation frameworks, where institutions engender and regulate action, National Systems of Entrepreneurship are driven by individuals, with institutions regulating who acts and the outcomes of individual action. Building on these principles, we also introduce a novel index methodology to characterize National Systems of Entrepreneurship. The distinctive features of the methodology are: (1) systemic approach, which allows interactions between components of National Systems of Entrepreneurship; (2) the Penalty for Bottleneck feature, which identifies bottleneck factors that hold back system performance; (3) contextualization, which recognizes that national entrepreneurship processes are always embedded in a given country's institutional framework.     

An economic evaluation of Iranian public agricultural R&D policy: The case of sugarbeet

Despite its long tradition in the economic literature, there is no acceptable economic evaluation of Iranian public agricultural R&D policy mainly because of the lack of reliable estimates of supply shift parameter. Sugarbeet is chosen as a case for the estimation of the parameter using the method developed here and then the efficiency of the public investment in sugarbeet research is evaluated using the ordinary cost–benefit analysis. Research station records for 1982–2004 are used to estimate annual changes in beet attributes of root yield and sugar content and the estimates are used to make an evaluation of Iranian beet research investment. The results showed that the investment led to an average of 7.18% annual increase in beet sugar supply during the period (composing of +7.74% change in root yield index and −0.5% change in sugar content index) giving an internal rate of return of 32% (or an NPV/ha of $69) to this investment. It is concluded that although the investment has been profitable in comparison to other public investment projects, the efficiency of the policy is not comparable to that common in the literature and a revision in the policy is proposed.     

珠海经济特区自主创新政策体系实效评估暨优化

为进一步完善和优化珠海市现行自主创新政策法规体系,使之更加适应于新形势下自主创新的需要,首先探讨和设计了对自主创新政策法规体系的实效进行评估的多角度方法,又根据这种方法对珠海市现行自主创新政策法规体系的实效情况作出了评估,最后根据评估结论,针对性地提出了进一步完善、优化自主创新政策法规体系的对策措施.     

Higher growth through the Blue Ocean Strategy: Implications for economic policy

Higher growth is a key goal of companies, governments, and societies. Economic policies often attempt to attain this goal by targeting companies of certain sizes that operate in specific industries and focus on a specific business activity. This approach to policy making has considerable shortcomings and seems to be less than fully effective in increasing economic growth. We suggest a new approach to policy making that stems directly from the entrepreneurial perspective. This approach examines a successful business strategy framework - the Blue Ocean Strategy - to discover conditions for high growth. We test the propositions on empirical data for two cases of successful high-growth business, namely Slovenian gazelles and Amazon.com. The results reveal a gap between the macro level of economic policy making to achieve higher growth and the micro level of business growth. The findings call for a change in the focus of economic policies on specific size companies, industries, and business activities to intraindustry cooperation, collaboration between companies of different sizes, value innovation, and creation of uncontested markets.     

制造业低碳技术创新的动力源探究及其政策涵义

低碳技术创新是发展低碳经济的根本途径,但企业作为技术创新的主体,现实中其低碳技术创新的动力仍有待加强。为提高环境与能源政策的针对性,有必要进一步了解企业低碳技术创新动力的真实状况。本文首先通过理论回顾,提出了企业低碳技术创新可能的几个动力源,建立了动力源分析框架,然后以浙江某开发区为主开展问卷调查。论文将该调查结果与同时进行的上海某区调查进行横向比较,以考察当前企业低碳活动动力的分布特征;并与1994年许庆瑞研究团队的调查进行纵向比较,以考察动力源的变化和演变特征。最后,本文总结了实证研究的理论涵义,提出了相关的政策建议。