Economic Complexity in Mexico

Economic Complexity

#permalink to section

The Economic Complexity (EC) methodology uses high-resolution data on the activities that are present in a given geography to predict the development dynamics of countries, cities and regions. The EC theoretical framework can use different data sources can be used to calculate EC (employment, production, exports, patents). In general, the rule is to use the data with the best resolution and manifestation of economic activities.

The complexity is related to the capacities, resources, technologies, human capital and infrastructure required for its development. One measure of such complexity is the Economic Complexity Index (ECI), which captures how complex an economy is by identifying both the activities it can successfully carry out and where else those activities are present. CE can be applied using data on the manufacture, sales or export of products, in which case we speak of Economic Complexity of Products (PCI) and can also be calculated using data on employment or production of economic activities through the Index of Complexity of Activities Economics (ACI).

According to the Observatory of Economic Complexity, in 2020 Mexico was the 9th economy in total exports, the 13th in total imports, and the 23 most complex economy in terms of the ECI.

In the second half of 2021, the most complex states in Mexico with respect to the accumulation of capabilities measured by the size of the labor force were Nuevo León (1.78), Querétaro (1.6), and Baja California (1.28). The most complex metropolitan areas based on the criteria as above were Juárez (2.39), Monterrey (2.17), and Querétaro (2.04).

Geographical Economic Complexity

#permalink to section

Economic Complexity Evolution

#permalink to section
Measure
Argentina
Brazil
Canada
Spain
United States

Over the past 8 years, Mexico's economy has become relatively more complex globally, rising from position 26 in 2012 to position 23 in 2020.

Source: Observatory of Economic Complexity (OEC).

Territorial Economic Complexity

#permalink to section
To see how
Level

The map shows the difference in Economic Complexity Index (ECI) between the different geographic areas. Colors closer to blue indicate greater economic complexity and values closer to red refer to less complexity.

A higher ECI value is commonly related to the presence of comparative advantages in more complex industries that are generally developed in a small number of territories.

The ECI is calculated from a proxy metric of the number of workers by industry group.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).

Product Economic Complexity

#permalink to section

Product Complexity Index

#permalink to section

The table presents the Product Complexity Index (PCI) calculated for 4-digit products according to the Harmonized System (HS4) in the selected year and that are exported by Mexico.

Source: Prepared by DataMéxico with information from BACI - HS6 REV. 2012 (2012 - 2020)

info-sign
Specialization

The product space corresponds to the relationship between the products that make up the productive structure of a locality. The existence of links between the graphed products represent a high level of co-export worldwide (when a country exports one of these products, it is likely that it also exports the product that is connected) (Hidalgo, et.al. 2007).

The densest zones of the product space represent those areas where the products with the highest correlation with each other are concentrated, that is, those products that have similar requirements for their development.

The colored nodes in the visualization represent the products exported by the territory and their size is associated with the value of exports according to the year defined by the user in the selectors. The length of the bonds is associated with the proximity or co-occurrence of the products.

Source: Prepared by DataMéxico with information from BACI - HS6 REV. 2012 (2012 - 2020)

Industry Economic Complexity

#permalink to section

Economic Activity Complexity Index

#permalink to section
Level

The table represents the Economic Activity Complexity Index (ACI) calculated for the selected industrial level, considering industries that have at least 300 people employed in the selected year.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).

Industry Specialization by State

#permalink to section
Level

The graphs allow the comparison of states according to the industries with the greatest comparative advantage(especialization), calculated from a proxy metric of the number of workers by industry, according to the year and the level of industry defined by the user.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).

Territory Specialization by Industry

#permalink to section
Level

The charts allow you to compare industries based on the states with the greatest comparative advantage (RCA), calculated from a proxy metric of the number of workers by industry in a year defined by the user.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).

Most Complex Industries by State

#permalink to section
Level

The graphs allow the comparison between states of the most complex industries (ACI), calculated from a proxy metric of the number of workers by industry, according to the year and the industrial level defined by the user.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).

Most Complex Geographies by Industry

#permalink to section
Level

The graphs allow comparison between industries, the states with greater complexity calculated from a proxy metric of the number of workers by industry in the year defined by the user.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).

Industry Space

#permalink to section
Specialization

The industry space corresponds to the relationship between the economic activities that make up the productive structure of a locality The existence of links between the graphed industries represent a high level of co-occurrence in the generation of employment in said industries at the national level.

The densest zones of the industry space represent those areas where the industries with the highest correlation with each other are concentrated.

The colored nodes in the visualization represent industries developed by Aguascalientes, according to the year and the comparative advantage (RCA) defined by the user.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).

Smart Diversification

#permalink to section

Product Diversification Frontier

#permalink to section
info-sign
Level
Specialization

The Relatedness-Complexity graph by product compares the risk and the strategic value of the opportunities of developing a certain product in a territory. A high relatedness is a good indicator of a high probability that a state will increase the size of the market in said product.

In the graph, each circle represents a product and its size is associated with the value of exports. The larger the circle, the greater the value of exports of that product.

Source: Prepared by DataMéxico with information from the Merchandise Trade Balance of Mexico.

Industry Diversification Frontier

#permalink to section
Level
Specialization

The graph of Relatedness-Complexity by industrial activity compares the risk and the strategic value of the opportunities to develop an industrial activity in a territory. High relatedness is a good indicator of a high probability that a state will increase market size in an industry.

In the graph, each circle represents an industry and its size is associated with a proxy for the number of employees. The larger the circle, the greater the number of people employed in that industry.

Source: Prepared by DataMéxico with information from the National Statistical Directory of Economic Units (DENUE).