Odd Lots
How Economic Complexity Explains Which Countries Become Rich
Aug 14, 2023
Join Ricardo Hausmann, a Harvard professor and economic complexity expert, as he delves into why some countries prosper while others struggle. He explains the concept of economic complexity and how a nation's economic growth can be predicted. Hausmann emphasizes the role of diversified exports and collective societal knowledge in driving development. He uses fascinating examples from countries like Bangladesh and Japan to illustrate how diversifying economies can lead to improved wealth. It's a deep dive into the intricate dance of economies and their evolution.
51:16
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Quick takeaways
- Economic complexity is a measure of a country's knowledge and capabilities, assessed by looking at the diversity and complexity of its exports.
- Higher economic complexity relative to income level predicts faster future growth, while lower complexity predicts slower growth.
Deep dives
Economic complexity as a measure of societal knowledge
Economic complexity is a measure of how much a country or society knows how to do. It assesses the knowledge and capabilities of a society by looking at the diversity and complexity of its exports. Just as individuals have different levels of knowledge and expertise, societies also vary in their collective knowledge. Economic complexity takes into account the range of different products a country can produce and the difficulty in making those products.
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