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Some New Views on Product Space and Related Diversification

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  • Onder Nomaler
  • Bart Verspagen

Abstract

We aim to contribute to the literature on product space and diversification by proposing a number of extensions of the current literature: (1) we propose that the alternative but related idea of a country space also has empirical and theoretical appeal; (2) we argue that the loss of comparative advantage should be an integral part of (testing the empirical relevance of) the product space idea; (3) we propose several new indicators for measuring relatedness in product space; and (4) we propose a non-parametric statistical test based on bootstrapping to test the empirical relevance of the product space idea.

Suggested Citation

  • Onder Nomaler & Bart Verspagen, 2022. "Some New Views on Product Space and Related Diversification," Papers 2203.16316, arXiv.org.
    • Handle: RePEc:arx:papers:2203.16316
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    References listed on IDEAS

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    1. Coniglio, Nicola D. & Vurchio, Davide & Cantore, Nicola & Clara, Michele, 2021. "On the evolution of comparative advantage: Path-dependent versus path-defying changes," Journal of International Economics, Elsevier, vol. 133(C).
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    3. Hausmann, Ricardo & Rodrik, Dani, 2003. "Economic development as self-discovery," Journal of Development Economics, Elsevier, vol. 72(2), pages 603-633, December.
    4. Boschma, Ron & Capone, Gianluca, 2015. "Institutions and diversification: Related versus unrelated diversification in a varieties of capitalism framework," Research Policy, Elsevier, vol. 44(10), pages 1902-1914.
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    6. Ricardo Hausmann & Bailey Klinger, 2007. "The Structure of the Product Space and the Evolution of Comparative Advantage," CID Working Papers 146, Center for International Development at Harvard University.
    7. Sanjaya Lall, 2000. "The Technological Structure and Performance of Developing Country Manufactured Exports, 1985-98," Oxford Development Studies, Taylor & Francis Journals, vol. 28(3), pages 337-369.
    8. C. A. Hidalgo & B. Klinger & A. -L. Barabasi & R. Hausmann, 2007. "The Product Space Conditions the Development of Nations," Papers 0708.2090, arXiv.org.
    9. Ricardo Hausmann & Bailey Klinger, 2006. "Structural Transformation and Patterns of Comparative Advantage in the Product Space," CID Working Papers 128, Center for International Development at Harvard University.
    10. Dany Bahar & Rodrigo Wagner & Ernesto Stein & Samuel Rosenow, 2017. "The Birth and Growth of New Export Clusters: Which Mechanisms Drive Diversification?," CID Working Papers 86a, Center for International Development at Harvard University.
    11. G. N. von Tunzelmann, 1995. "Technology and Industrial Progress," Books, Edward Elgar Publishing, number 437.
    12. Ron Boschma & Gianluca Capone, 2016. "Relatedness and diversification in the European Union (EU-27) and European Neighbourhood Policy countries," Environment and Planning C, , vol. 34(4), pages 617-637, June.
    13. Jose Antonio Alonso & Víctor Martín, 2020. "Product relatedness and economic diversification at the regional level in two emerging economies: Mexico and Brazil," Regional Studies, Taylor & Francis Journals, vol. 53(12), pages 1710-1722, July.
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    More about this item

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy

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