 Indicators of Product Sophistication and Factor Intensities: Measurement MattersChapter Chapter 2 in Product Characteristics in International Economics, 2018, pp 9-50 from Springer Abstract: Abstract The widely used PRODY indicator by Hausmann et al. (J Econ Growth 12(1):1–25, 2007) allows the calculation of product sophistication and factor intensities at high levels of disaggregation. In this chapter I deal with its measurement, its conceptional limitations, its sensitivity to subjective decision making, its alternatives, and how to reap the best possible benefit from its usage. I introduce a theory-based alternative and investigate the sensitivity of empirical results with respect to different measures. In particular, I re-estimate the main results of Hausmann et al. (J Econ Growth 12(1):1–25, 2007) with 75 different measures. Small changes to the sample, the aggregation level, or the construction of the indicator can make a difference. Moreover, I offer two Stata programs that ease the calculation of various PRODY variants. Keywords: Sophisticated Products; Endowment Data; Revealed Comparative Advantage Index; Standard International Trade Classification (SITC); Trade Weights (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:spr:conchp:978-3-319-76093-3_2 Ordering information: This item can be ordered from DOI: 10.1007/978-3-319-76093-3_2 Access Statistics for this chapter More chapters in Contributions to Economics from Springer |
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