On the predictability of growth

Matthieu Claudio Ascagne Cristelli, Andrea Tacchella, Masud Z. Cader, Kirstin Ingrid Roster and Luciano Pietronero

No 8117, Policy Research Working Paper Series from The World Bank

Abstract: A country's productive structure and competitiveness are harbingers of growth. Growth is a dynamic process based on capabilities that are difficult to define and measure across countries. This paper uses a global measure of fitness (or complexity-weighted diversity of production) as a method to explore a country's relative growth potential. The analysis finds that there are two types of growth, predictable or laminar, and unpredictable. This classification is used to create a selection mechanism (the Selective Predictability Scheme), defining future growth trajectories for similar countries, and compares projected long-term, five-year forecasts with traditional methods used by the International Monetary Fund. The analysis finds that production structure is a good long-term predictor of growth, with prediction performance falling off for countries not yet in the laminar classification.

Keywords: Economic Growth; Economic Theory&Research; Industrial Economics; Trade Technology and Productivity (search for similar items in EconPapers)
Date: 2017-06-26
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:wbk:wbrwps:8117

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