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Back from the hills of NC to the urb of Toronto. Normally, it is 
selections by me, but this week the full Complexity Digest has only these 
2 items. Both are relevant.

   Barry Wellman

   Step by step, link by link, putting it together--Streisand/Sondheim
        The earth to be spannd, connected by network--Walt Whitman
              It's Always Something--Roseanne Roseannadanna

              A day like all days, filled with those events
          that alter and illuminate our times--Walter Cronkite
   Director, NetLab Network      			            FRSC
         Founder, International Network for Social Network Analysis
   NETWORKED: The New Social Operating System  Lee Rainie & Barry Wellman    

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Date: Mon, 16 Sep 2019 11:01:30 +0000
From: "[utf-8] Complexity Digest" <[log in to unmask]>
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To: "[utf-8] Barry" <[log in to unmask]>
Subject: [utf-8] Latest Complexity Digest Posts

Learn about the latest and greatest related to complex systems research. More at 

Bilateral relatedness: knowledge diffusion and the evolution of bilateral trade

    During the last two decades, two important contributions have reshaped our understanding of international trade. First, countries trade more with those with whom they share history, language, and culture, suggesting that trade is limited by information frictions. Second, countries are more likely to start exporting products that are related to their current exports, suggesting that shared capabilities and knowledge diffusion constrain export diversification. Here, we join both of these streams of literature by developing three measures of bilateral relatedness and using them to ask whether the destinations to which a country will increase its exports of a product are predicted by these forms of relatedness. The first form is product relatedness, and asks whether a country already exports many similar products to a destination. The second is importer relatedness, and asks whether the country exports the same product to the neighbors of the target destination. The third is exporter
relatedness, and asks whether a country˙˙s neighbors are already exporting the same product to the destination. We use bilateral trade data from 2000 to 2015, and a variety of controls in multiple gravity specifications, to show that countries are more likely to increase their exports of a product to a destination when they have more product relatedness, importer relatedness, and exporter relatedness. Then, we use several sample splits to explore whether the effects of these forms of relatedness are stronger for products of higher complexity, technological sophistication, and differentiation. We find that, in the case of product relatedness, the effects are stronger for differentiated, complex, and technologically sophisticated products. Also, we find the effects of common language and shared colonial past to increase with differentiation, complexity, and technological sophistication, while the effects of shared borders decrease with these three variables. These results suggest that product
relatedness and common language capture dimensions of knowledge relatedness that are more important for the exchange of more sophisticated and differentiated products. These findings extend the ideas of relatedness to bilateral trade and show that the evolution of bilateral trade networks are shaped by relatedness among products, exporters, and importers.

Bilateral relatedness: knowledge diffusion and the evolution of bilateral trade
Bogang Jun, Aamena Alshamsi, Jian Gao, César A. Hidalgo

Journal of Evolutionary Economics 

Source: ( )

Innovation and The Evolution of the Economic Web

    Fifty thousand years ago the global economy may have had a diversity of 
a few thousand goods and services, including fire, unifacial stone 
scrapers, hides, and so forth. Today, in New York alone, there must be 
over a billion goods and services. The global economy has exploded in 
diversity. The question is how and why has this explosion occurred? The 
economy, as detailed a bit further below, is a network of complements and 
substitutes, which I will call the Economic Web. And like the biosphere, 
it˙˙s evolution is substantially unprestatable, ˙˙context dependent,˙˙ and 
creates its own growing ˙˙context˙˙ that comprises its ˙˙Adjacent 
Possible.˙˙ The adjacent possible is what can arise next in this 
evolution. This evolution is ˙˙sucked into˙˙ the very opportunities it 
itself creates. Innovations into the Adjacent Possible drive this growth. 
I do not wish to consider here the rich evolution of a single technology. 
Brian Arthur has brilliantly done so in his book The Nature of Technology 
[1]. Rather, I wish to discuss the evolution of the entire economic web, 
for as we shall see, goods and services create novel niches which invite 
the innovative creation of new complementary and substitute goods such 
that the web as a whole grows in diversity.

Innovation and The Evolution of the Economic Web
by Stuart Kauffman

Entropy 2019, 21(9), 864

Source:  ( )

Sponsored by the Complex Systems Society.
Founding Editor: Gottfried Mayer.
Editor-in-Chief: Carlos Gershenson.

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