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Growth networks

Author

Listed:
  • Kali, Raja
  • Reyes, Javier
  • McGee, Joshua
  • Shirrell, Stuart

Abstract

We map the relationship between products in global trade and the products a country exports as a network to devise a measure of the density of links between the products in a country's export basket and a measure of network proximity from a country's export basket to products that a country does not export. The density measure is a proxy for synergies between the products in a country's export basket. The network proximity measure is an indicator of how difficult it is likely to be for a given country to move from its current product specialization to new products. We find that density and network proximity are together of importance for a poor country to move to higher income products and experience higher growth rates. Higher network proximity is associated with a greater likelihood of experiencing growth acceleration, but the positive effect of density tapers off at higher values.

Suggested Citation

  • Kali, Raja & Reyes, Javier & McGee, Joshua & Shirrell, Stuart, 2013. "Growth networks," Journal of Development Economics, Elsevier, vol. 101(C), pages 216-227.
    • Handle: RePEc:eee:deveco:v:101:y:2013:i:c:p:216-227
    DOI: 10.1016/j.jdeveco.2012.11.004
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    Cited by:

    1. Nan Li & Ana Maria Santacreu & Jie Cai, 2016. "Knowledge Diffusion and Trade Across Countries and Sectors," 2016 Meeting Papers 650, Society for Economic Dynamics.
    2. Desmarchelier, Benoît & Regis, Paulo José & Salike, Nimesh, 2018. "Product space and the development of nations: A model of product diversification," Journal of Economic Behavior & Organization, Elsevier, vol. 145(C), pages 34-51.
    3. Poncet, Sandra & Starosta de Waldemar, Felipe, 2013. "Export Upgrading and Growth: The Prerequisite of Domestic Embeddedness," World Development, Elsevier, vol. 51(C), pages 104-118.
    4. Chen, Zhao & Poncet, Sandra & Xiong, Ruixiang, 2017. "Inter-industry relatedness and industrial-policy efficiency: Evidence from China’s export processing zones," Journal of Comparative Economics, Elsevier, vol. 45(4), pages 809-826.
    5. Angeon, Valérie & Bates, Samuel, 2015. "Reviewing Composite Vulnerability and Resilience Indexes: A Sustainable Approach and Application," World Development, Elsevier, vol. 72(C), pages 140-162.
    6. Juan Lucio & Raúl Mínguez & Asier Minondo & Francisco Requena, 2016. "Networks and the Dynamics of Firms' Export Portfolio: Evidence for Mexico," The World Economy, Wiley Blackwell, vol. 39(5), pages 708-736, May.
    7. French, Scott, 2017. "Revealed comparative advantage: What is it good for?," Journal of International Economics, Elsevier, vol. 106(C), pages 83-103.
    8. Önder, Ali Sina & Yilmazkuday, Hakan, 2016. "Trade partner diversification and growth: How trade links matter," Journal of Macroeconomics, Elsevier, vol. 50(C), pages 241-258.
    9. Juan de Lucio & Raúl Mínguez & Asier Minondo & Francisco Requena, 2013. "The dynamics of firms’ export portfolio: A network analysis with an application to Mexico and Bulgaria," Working Papers 1316, Department of Applied Economics II, Universidad de Valencia.

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    More about this item

    Keywords

    Trade; Growth acceleration; Networks; Small-world;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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