Researchers find a country’s wealth correlates with its collective knowledge

From PhysOrg:

What causes the large gap between rich and poor countries has been a long-debated question. Previous research has found some correlation between a nation’s economic prosperity and factors such as how the country is governed, the average amount of formal education each individual receives, and the country's overall competiveness. But now a team of researchers from Harvard and MIT has discovered that a new measure based on a country's collective knowledge can account for the enormous income differences between the nations of the world better than any other factor.

The researchers, led by Ricardo Hausmann, director of Harvard’s Center for International Development and former Minister of Planning for Venezuela, and Cesar A. Hidalgo, assistant professor at MIT’s Media Laboratory and faculty associate at Harvard’s Center for International Development, have published a book called The Atlas of Economic Complexity. Starting today, the book is free to download at http://atlas.media.mit.edu. The authors plan to launch the book during an exclusive event at Harvard's Center for International Development on October 27th. Attendees will include chief economists of the World Bank and the Asian Development Bank, among other guests. In the book, the authors show how the total amount of knowledge embedded in a country’s economy can be measured by a factor they call “economic complexity.” From this perspective, the more diverse and specialized jobs a country’s citizens have, the greater the country’s ability to produce complex products that few other countries can produce, making the country more prosperous.

More here.