Abstract:

Economic complexity is considered an essential determinant of economic growth. Our research follows the "Product Space" methodology to compute an index for the Economic Complexity of Romanian territorial units. A Romanian panel dataset is being analyzed using a system GMM approach to investigate the impact of economic complexity and exports on economic growth. Both short and long-run estimates are obtained for the exogenous variables. Results support our research hypotheses, documenting that economic complexity is a significant contributor to wealth at the territorial level. Most importantly, our findings advocate the necessity to conceive strategies to foster the development of economic complexity.