Viktor Stojkoski, César A. Hidalgo
Research Policy Volume 55, Issue 4, May 2026, 105454
Efforts to apply economic complexity to identify diversification opportunities often rely on diagrams comparing the relatedness and complexity of products, technologies, or industries. Yet, the use of these diagrams, is not based on empirical or theoretical evidence supporting some notion of optimality. Here, we introduce an optimization-based framework that identifies diversification opportunities by minimizing a cost function capturing the constraints imposed by an economy’s pattern of specialization. We show that the resulting portfolios often differ from those implied by relatedness–complexity diagrams, providing a target-oriented optimization layer to the economic complexity toolkit.
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