United Kingdom - The 14th Most Complex Economy in the World
The Atlas of Economic Complexity shows the UK economy as the 14th most complex one in the world. But what exactly does it mean? In order to correctly interpret this information, we will introduce the Atlas of Economic Complexity, the concept of economic complexity and interpret being at the 14th place in this ranking.
Harvard’s Growth Lab at the Center for International Development (CID) at Harvard University analyses the dynamics of economic growth. Economic diversity and complexity is placed at the center of the development research and the Atlas of Economic Complexity is an end product of the work conducted there. In fact, the original online Atlas was launched as a complementary tool to a book, but in time it has been significantly enhanced. Now it serves as a reliable source for policymakers, investors, entrepreneurs, academics and the general public for understanding a country’s economic structure.
In creating the Atlas, industrial capabilities and knowhow of a country are accepted to be at the heart of its growth prospects, where the diversity and complexity of existing capabilities heavily influence growth. According to these, the economic complexity of a country is calculated based on the diversity of exports it produces and their ubiquity. Here, diversity is a measure of how many different types of products a country is able to produce and ubiquity measures the number of countries that are able to make a product. Since the production of a good requires a specific set of know-how, a country’s total diversity is another way of expressing the amount of collective know-how held within that country.