Dynamics of Economic Complexity in Canada: A Multifaceted Long-Term Analysis
Dynamics of Economic Complexity in Canada: A Multifaceted Long-Term Analysis

Summary/Abstract: In this study, factors influencing the economic complexity (ECI) of Canada in the long term have been examined using the VECM, FMOLS, CCR, and DOLS methods from 1995 to 2022. The independent variables in the empirical model include Gross Domestic Product (GDP), Research and Development (R&D), Trade (TRD), Education (EDU), Political Stability (PS), and Government Effectiveness (GE). An increase in GDP, R&D, EDU and TRD demonstrates a strong positive effect on economic complexity. This emphasizes the crucial significance of production, productivity, efficiency and globalization in shaping the complex network of economic processes. PS and GE play crucial roles, as even slight improvements in these areas can have a positive impact on the ECI. This outcome highlights the beneficial impact of stable governance in promoting economic complexity.

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