An Empirical Analysis of Economic Complexity and Commodity Dependence

Sofia Dominguez, Cosimo Frontera () and Clovis Freire
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Sofia Dominguez: UNCTAD
Cosimo Frontera: UNCTAD
Clovis Freire: UNCTAD

Chapter Chapter 2 in Proceedings of the Global Conference on Economic Diversification 2024, 2026, pp 21-41 from Springer

Abstract: Abstract This paper explores the relationship between economic complexity and commodity dependence, employing a fixed effects model with a sample of 184 countries from 1995 to 2019. The results show that as countries increase their economic complexity, they reduce their dependence on commodity exports. This result holds across all countries with different ranges of commodity dependence and remains significant to a series of robustness checks. The results highlight the importance of fostering technological capabilities and a diversified industrial base that allows for producing more complex products, which would help mitigate the adverse effects of commodity dependence. The paper recommends that governments prioritize value addition and strategic export diversification to enhance economic complexity and support sustainable growth in commodity-dependent developing countries.

Keywords: Economic complexity; Export diversification; Commodity dependence; Development (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-981-95-2022-0_2

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DOI: 10.1007/978-981-95-2022-0_2

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