Technological content of export diversification—Evolution along the economic growth process

Aleksandra Parteka, Zuzanna Helena Zarach and Aleksandra Kordalska

Structural Change and Economic Dynamics, 2025, vol. 74, issue C, 14-27

Abstract: Exports from high-income countries are three times more diversified than those from low-income economies. We provide a new tech-based interpretation of the stages of diversification accompanying the economic growth paths of countries. Using the decomposition properties of the relative Theil index in a sample of 160 countries (1996–2018), we reveal that export diversification is driven mainly by changes in the variety of non-tech exports. However, the role of the technological component (technological diversification) increases as countries grow, and in high-income countries, it is responsible for more than one-third of the overall export diversification level. We examine country-specific diversification trajectories, showing that the rapid development of technological capacity drove export diversification in China or India. The technological component can explain 40 % of the perfectly diversified U.S. export structure. We show that 4IR exports embodying digital technologies play a negligible role in the diversification process due to their small measurable share in total exports.

Keywords: Export diversification; Technological progress; Theil decomposition; Economic growth (search for similar items in EconPapers)
JEL-codes: F14 O11 O33 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:streco:v:74:y:2025:i:c:p:14-27

DOI: 10.1016/j.strueco.2025.02.012

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