The Theory of Economic Complexity: A Study of Armenia

Ivan Nikonov () and Anton Votinov ()

Finansovyj žhurnal — Financial Journal, 2018, issue 4, 121-131

Abstract: The article provides the analysis of the future prospects for the economic development in the Republic of Armenia. The authors choose the theory of economic complexity, developed by Cesar A. Hidalgo and Ricardo Hausmann, as the baseline for the research. Based on the theoretical premises, the economic complexity index (ECI) for Armenia was calculated and then compared to the ECI of other countries. This study further establishes how the development of economic sectors influences the complexity of the product space in the Armenian economy. The results reveal that in terms of economic complexity Armenia is ahead of some neighboring countries and some EAEU members. The original methodology of opportunity value index estimation was modified for research purposes. This methodology was used to assess the most promising areas of development of the Armenian economy. The authors suppose that manufacturing can contribute significantly to the long-term economic growth in the Republic of Armenia; however, in order to create the necessary conditions for the growth enormous efforts are required for this sector development.

Keywords: economic complexity; Armenian economy; economic growth; national income; growth diagnostics; competitive advantage; Balassa’s model; economic competitiveness (search for similar items in EconPapers)
JEL-codes: F43 O11 O47 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:fru:finjrn:180411:p:121-131

DOI: 10.31107/2075-1990-2018-4-121-131

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