The Dynamics of Economic Complexity and the Product Space over a 42 year period

I'm in an economics reading group, and we are currently reading Jane Jacobs's The Economy of Cities (which I will forever think and pronounce in a British accent because of my professor), and our professor e-mailed this note to the lot of us along with these links:

___________________________________________

From: Professor
Date: 12 Feb 2010 08:50:57 -0500
Subject: Economics reading group - FYI
To: Group

Mainstream economics is catching up with Jane Jacobs!

I attach an article from last week's Economist.

http://www.chidalgo.com/Papers/HidalgoHausmann_PNAS_2009_PaperAndSM.pdf
http://www.chidalgo.com/Papers/HidalgoHausmann_DAI_2008.pdf
http://www.cid.harvard.edu/cidwp/189.html

Question: Which is more informative about what is going on--Jacobs's stories or the economists graphs and statistics?
___________________________________________

I think it's the graphs and statistics, btw. It's such a fascinating study... just even look at all the charts and complex diagrams... I'm impressed already. See, this is when math and statistics are cool, when you can draw some sort of macro conclusion from it. 

"In particular we identify Brazil, Indonesia, Turkey, Malaysia, Thailand, Korea, Singapore and China, as countries that transformed their productive structures considerably during these four decades, albeit following different trajectories."

So... like BRIC, but BITMTKSC. Haha. Sorry, horrid joke. Better to let the abstract speak for itself without inserting my useless pithy comments. See below.

___________________________________________

CID Working Paper No. 189, December 2009

The Dynamics of Economic Complexity and the Product Space over a 42 year period

César A. Hidalgo

Abstract

How does the productive structure of countries' changes over time? In this paper we explore this question by combining techniques of networks science with 42 years of trade data and find that, while the Product Space remains relatively stable during this period, the dynamics of countries' productive structures is characterized by a few highly dynamic economies. In particular we identify Brazil, Indonesia, Turkey, Malaysia, Thailand, Korea, Singapore and China, as countries that transformed their productive structures considerably during these four decades, albeit following different trajectories. For instance, the economic complexity of Korea, Singapore and China was relatively high at the beginning of the observation period and continued to increase during these forty two years, moving these countries into the top spots of the economic complexity rankings for the beginning of this millennium. Brazil, Indonesia and Turkey, on the other hand, transformed their productive structures significantly during the same period of time, but did so starting from a less sophisticated foundation. We conclude the paper by moving from this and other observations into the policy implications of this view of economic development and argue that the government involvement in the private sector should be to help catalyze market activities and solve coordination problems that emerge naturally when countries try to accumulate capabilities. This represents an alternative to more traditional views of the role of government that postulate, in their extremes, that the public sector should either have no involvement in private sector activities or, on the other hand, substantial ownership of the means of production.

Keywords: Economic Complexity, Capabilities, Networks, Product Space, Structural Transformation, Economic Development
___________________________________________

DIY and The Economy

<---dumb Proenza Schouler tissue tee for $325 <--smart: Seven for All Mankind sequin jacket $495 (kidding--you could buy that thing at H&M for much less) -->LaRok's interpretation of reality is funny.

I went to Saks and Barney's today to browse pretty things I couldn't buy (though Saks was having yet another 40% off sale). In my promenade among soft satins and busy beads, I realized that the trends nowadays are quite extreme and indulgent, reflecting consumers' needs to feel satisfied when dropping $400 on a top. Nobody wants a T-shirt from The Row that looks the same as one from H&M. They want beads, faux fur, leather and feathers. At Saks, it felt as though if a shirt wasn't beaded, it had ruffles poured all over. Plain leggings are rare compared to pleather ones, or perhaps a pair with intricate gold prints and enough zippers to permanently chafe me. Designers are being forced to go to the extreme to make consumers feel like they are indulging themselves when they're buying something.



On another note, at Barney's I saw feather and bow headbands that I realized I could make by buying feathers and glue at Jo-Anne Fabrics or something. Much cheaper, and really, it means more to make your own accessories.
I even saw a dress by Vena Cava that was really cute with a black, stringy trim stitched all over. I felt like that $500 dress could have been a product of my late night frustration with a needle and thread. Winter term in Hanover will be my time for experimenting with cheapo products and making them look expensive. Aka I'll be starting my own personal Forever 21.

Pandas, Wildlife Conservation, China, Economics

New Scientist did an interview with Lü Zhi, the director of the Center for Nature and Society at Peking University, Beijing, China. She has studied pandas for two decades, served as the director of the World Wide Fund for Nature's panda conservation programme and runs the conservation NGO Shan Shui.

Are attitudes to the environment in China changing as people's wealth increases?

There are two trends. One is a greater awareness. For instance, a group of young Chinese entrepreneurs is calling for an end to the consumption of shark fin soup. But there is also a rise in the number of affluent people who want to show off their wealth. Eating wildlife is a part of Chinese culture, so when people get richer they eat more wildlife. They need something to persuade them. I think culture is the most effective tool. A respect for life is part of the Buddhist tradition, which has had a big influence on Chinese culture, though sometimes people forget it.

Is it weird that this is nearly exactly how I feel? I want the shark fin soup (yum) but I want the shark too. (I want to make a joke here that somehow combines the phrases "have your cake and eat it too" and "jumped the shark".) She also talks about the role of economics and markets in the future of conservation:

Is this new economic system in place?

In some provinces of China, GDP is not the only measure of development. The economic value of ecosystems, such as the carbon dioxide absorbance of forests, are factored in. At Shan Shui, the NGO I run, we want to show specific things that can be implemented, such as water users paying a proportion of their water-use fee to subsidise forest conservation upstream. It's a market-based attempt at conservation.

What comes next?

To work with economists. I recently went to a forum to brainstorm issues to be discussed at the World Economic Forum in Davos, Switzerland. In one discussion there were 30 to 40 people focusing on the economy and me, with my focus on ecology. I looked out for how often they mentioned biodiversity or conservation. Neither term was mentioned. That was a reality check for me. I think the next step is to work with economists, otherwise we conservationists are just talking to ourselves.

I love this intersection between environment and economics. And China and international affairs too, I guess. Haha what a great article to send me. Thanks, fans!

Read the article here.

Aerospace Engineering is Literally Rocket Science

Payscale, a site that collects data on salaries for different professions, conducted a study over the last year and here are the results. Note that the numbers are from 1.2 million users of PayScale's site who self-reported their salaries and educational credentials in a PayScale survey over the last year. From Yahoo Finance:


Some highlights from the data:

• Dartmouth College has the highest median mid-career salary (defined as salary at 10 years or greater after graduation).
• Loma Linda University has the highest median starting salary (defined as salaries within five years of graduation), a function of their strong programs in nursing, dental and allied health.
• In general, engineering schools produced the best starting salaries, and represented eight out of the top 10 schools in starting salary. On the other hand, Ivy League Schools are the best bet for mid-career pay, with five out of the top 10.
• Majors matter. Quantitative-oriented degrees -- like engineering, science, mathematics and economics -- filled most of the top 20 slots in both highest starting median salaries and highest mid-career median salaries.

• Economics majors have the fifth highest mid-career median salary, the 17th-highest starting salary, and the highest salary at the 90th percentile, mid-career mark.
• Some of the major/department numbers may fool you, though.

For example, who would have thought that philosophy majors in mid-career would earn more than information technology majors in mid-career? This is probably because students who major in philosophy are more likely to go to elite schools, whereas students who major in I.T. are likely to go to pre-professional-type schools that don't even offer philosophy as a major, Mr. Lee says. So it's not really the choice of major that's making the difference -- it's the school.

"A student's choice of major has a huge impact mid-career, enormous," says Mr. Lee. "But you generally don't see people majoring in philosophy" -- or other "soft" majors, he says -- "except in top schools."

That said, here are the bottom 10 majors by mid-career salary:

Read the article at Yahoo finance.
And glance at the full stats list here.

Preview a portion of the list:

School Name	School Type	Starting Median Salary	Mid-Career Median Salary
Loading...
Dartmouth College	Ivy League	$58,200	$129,000
Massachusetts Institute of Technology (MIT)	Engineering	$71,100	$126,000
Harvard University	Ivy League	$60,000	$126,000
Harvey Mudd College	Engineering	$71,000	$125,000
Stanford University	Engineering	$67,500	$124,000
Princeton University	Ivy League	$65,000	$124,000
Colgate University	Liberal Arts	$51,900	$122,000
University of Notre Dame	Private	$55,300	$121,000
Yale University	Ivy League	$56,000	$120,000
University of Pennsylvania	Ivy League	$60,400	$118,000
Rensselaer Polytechnic Institute (RPI)	Engineering	$62,500	$116,000
Duke University	Private	$56,800	$116,000
Bucknell University	Engineering	$56,100	$116,000
Bucknell University	Liberal Arts	$56,100	$116,000
California Institute of Technology (CIT)	Engineering	$69,700	$115,000
Polytechnic University of New York, Brooklyn	Engineering	$62,700	$114,000
Lehigh University	Engineering	$57,400	$114,000
Carnegie Mellon University (CMU)	Engineering	$65,300	$113,000
University of California, Berkeley	Engineering	$57,100	$112,000
University of California, Berkeley	State Schools	$57,100	$112,000
Santa Clara University	Private	$58,000	$111,000
Georgetown University	Private	$57,000	$111,000
Worcester Polytechnic Institute (WPI)	Engineering	$61,100	$110,000
Swarthmore College	Liberal Arts	$55,900	$110,000
Colorado School of Mines	Engineering	$60,000	$109,000
Colorado School of Mines	State Schools	$60,000	$109,000
Manhattan College	Private	$56,100	$109,000
Amherst College	Liberal Arts	$54,900	$109,000
Haverford College	Liberal Arts	$46,200	$109,000
Brown University	Ivy League	$52,300	$107,000
University Of Chicago	Private	$51,700	$107,000
Cornell University	Engineering	$58,000	$106,000
Cornell University	Ivy League	$58,000	$106,000
Lafayette College	Liberal Arts	$53,700	$106,000
Bowdoin College	Liberal Arts	$52,700	$106,000
Georgia Institute of Technology	Engineering	$58,900	$105,000
Georgia Institute of Technology	State Schools	$58,900	$105,000
Rice University	Private	$57,900	$105,000
Tufts University	Private	$48,200	$105,000
Dickinson College	Liberal Arts	$44,000	$105,000
New Jersey Institute of Technology (NJIT)	Engineering	$55,100	$104,000
New Jersey Institute of Technology (NJIT)	State Schools	$55,100	$104,000
Washington and Lee University	Liberal Arts	$51,800	$104,000
College of the Holy Cross	Liberal Arts	$46,600	$104,000
Carleton College	Liberal Arts	$45,400	$104,000
University of Southern California (USC)	Private	$54,600	$103,000
University of California, San Diego (UCSD)	State Schools	$50,700	$103,000
Williams College	Liberal Arts	$49,400	$103,000
Davidson College	Liberal Arts	$45,800	$103,000
Cooper Union	Engineering	$61,100	$102,000
Claremont McKenna College	Liberal Arts	$58,300	$102,000
California Polytechnic State University, San Luis Obispo (CalPoly)	Engineering	$57,000	$102,000
California Polytechnic State University, San Luis Obispo (CalPoly)	State Schools	$57,000	$102,000
Fairfield University	Private	$50,400	$102,000
Stevens Institute of Technology	Engineering	$59,400	$101,000
Boston College	Private	$51,500	$101,000
Bates College	Liberal Arts	$46,400	$101,000
Fordham University	Private	$46,100	$101,000
Columbia University	Ivy League	$57,300	$100,000
Vanderbilt University	Private	$51,800	$100,000
University of Illinois at Urbana-Champaign (UIUC)	Engineering	$53,900	$99,700
University of Illinois at Urbana-Champaign (UIUC)	Party Schools	$53,900	$99,700
University of Illinois at Urbana-Champaign (UIUC)	State Schools	$53,900	$99,700
Middlebury College	Liberal Arts	$45,000	$99,200
Villanova University	Engineering	$56,700	$99,000
Rose-Hulman Institute of Technology (RHIT)	Engineering	$61,100	$98,800
Tulane University	Party Schools	$47,800	$98,800
Clarkson University	Engineering	$55,400	$98,500
University of California, Santa Barbara (UCSB)	Party Schools	$49,700	$98,400
University of California, Santa Barbara (UCSB)	State Schools	$49,700	$98,400
Drexel University	Private	$54,100	$98,000
Illinois Institute of Technology (IIT)	Engineering	$57,400	$97,600
Case Western Reserve University	Engineering	$56,500	$97,500
Pomona College	Liberal Arts	$50,500	$97,500
Iona College	Private	$47,200	$97,500
Virginia Polytechnic Institute and State University (Virginia Tech)	Engineering	$52,900	$97,400
Virginia Polytechnic Institute and State University (Virginia Tech)	State Schools	$52,900	$97,400
George Washington University (GWU)	Private	$48,200	$97,300
Loyola College in Maryland	Liberal Arts	$45,000	$97,300
University of Virginia (UVA)	State Schools	$52,200	$97,200
University of California at Los Angeles (UCLA)	State Schools	$51,600	$97,000
Southern Methodist University (SMU)	Private	$48,600	$96,900
Connecticut College	Liberal Arts	$42,500	$96,800
San Jose State University (SJSU)	State Schools	$53,400	$96,300
New Mexico Institute of Mining and Technology (New Mexico Tech)	Engineering	$51,700	$96,300
Miami University	State Schools	$47,100	$96,100
Wesleyan University (Middletown, Connecticut)	Liberal Arts	$46,300	$95,700
Occidental College	Liberal Arts	$45,300	$95,700
University of California, Davis (UC Davis)	State Schools	$51,200	$95,400
St. John's University, New York	Private	$50,000	$95,400
Loyola Marymount University	Private	$43,500	$95,400
Missouri University of Science and Technology (Missouri S&T)	Engineering	$57,300	$95,200
Texas A&M University	State Schools	$51,100	$95,000
Johns Hopkins University	Engineering	$57,800	$94,900
New York University (NYU)	Private	$49,600	$94,900
Kettering University	Engineering	$57,900	$94,500
Emory University	Private	$50,600	$94,300
University of Colorado - Boulder (UCB)	Party Schools	$47,100	$94,300