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Dynamics of Economic Complexity in Canada: A Multifaceted Long-Term Analysis

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  • Kemal Erkisi
  • Melike Cetin

Abstract

In this study, factors influencing the economic complexity (ECI) of Canada in the long term have been examined using the VECM, FMOLS, CCR, and DOLS methods from 1995 to 2022. The independent variables in the empirical model include Gross Domestic Product (GDP), Research and Development (R&D), Trade (TRD), Education (EDU), Political Stability (PS), and Government Effectiveness (GE). An increase in GDP, R&D, EDU and TRD demonstrates a strong positive effect on economic complexity. This emphasizes the crucial significance of production, productivity, efficiency and globalization in shaping the complex network of economic processes. PS and GE play crucial roles, as even slight improvements in these areas can have a positive impact on the ECI. This outcome highlights the beneficial impact of stable governance in promoting economic complexity.

Suggested Citation

  • Kemal Erkisi & Melike Cetin, 2024. "Dynamics of Economic Complexity in Canada: A Multifaceted Long-Term Analysis," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 7, pages 3-20.
    • Handle: RePEc:bas:econst:y:2024:i:7:p:3-20
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    More about this item

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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