Canada's Declining Economic Complexity

Economic complexity measures the diversity and sophistication of the goods and services a country produces and exports. The Economic Complexity Index is published by the Observatory of Economic Complexity. It’s a useful aggregate measure for an important concept and it’s another indicator we’re studying for our upcoming paper on IP and R&D.

The Economic Complexity Index reflects the knowledge, skills and technologies in an economy and how they are combined to produce outputs. Higher scores indicate a country produces specialized products.

A low or falling score, like Canada’s, shows that outputs are declining in sophistication or that other countries have caught up and can produce similar products and services.

The good news is that Canada has the ingredients needed to improve. The complexity of our research ecosystems rank third in the world, even though our products and services rank 35th. Translating this research strength into Canadian innovation and value‑added production would raise Canada’s economic complexity.