The Causal Linkages of Human Development Index and Economic Complexity Index: a Panel Analysis for Selected OECD Countries

摘要

Economic theory debates that sustainable economic growth occurs through economic development. Successful development strategies substantially depend on a fast pace of growth and measured pace of economic openness. In this context, the Economic Complexity Index (ECI), which is the compound of a country's productive output have provided important insights into patterns of economic development. This study investigates the impact of the Human Development Index (HDI) on ECI in selected 24 OECD countries. Using panel data methodology for the period 1995-2018, the results of the study show that there has been a unidirectional causality running from economic complexity to human development in five developed countries, but human development Granger cause economic complexity in six countries. In addition, the feedback effect exists between human development and economic complexity for Spain at the 5% level of significance, indicating that both economic complexity and human development are influencing each other. Thus, the study emphasizes that for increasing the knowledge intensity of selected country groups there is a need to increase their accumulation of human capital in selected OECD countries.