Degree of specialization of the export basket and its relationship with the economic complexity of the Brazilian federative units

Abstract

This paper aims to verify the degree of sectoral specialization of exports of Brazilian states, and how this can be related to the economic complexity of these states. Considering the spatial characteristics of these variables, a spatial panel was used for the period 1998-2014. For the calculation of sectorial specialization of the Brazilian states, the EXPY index created by Hausmann, Hwang, and Rodrik (2007) was used. Yet, for the measure of economic complexity, the index proposed by Hidalgo and Hausmann (2009) was used, which is based on the iterations between the diversification of exporting economies and the ubiquity of exported products. The main results indicated that there is spatial dependence, both in the economic complexity index (ECI) and in the sectoral specialization index of the UFs, as well as a positive relationship between the specialization in high technology and the ECI of the UFs – indicating a cumulative cyclical effect between UFs with greater economic complexity.