The Effect of Knowledge Economy Components on Iran's Economic Complexity

The economic complexity index indicates the extent and variety of the export basket of a country. Studies have shown that countries that, in addition to diversifying products, have sophisticated manufacturing products, are usually more economically advanced and are expected to have faster economic growth. Also, the impact of the components of the knowledge economy on the economic complexity in the form of large and complex networks will enable them to produce a set of knowledgeable goods. Therefore, the present study examines the effect of knowledge economy components on the economic complexity of Iran using Vector Auto Regressive (VAR) during the period of 1975-2016. The results show that components of knowledge economy such as trade openness, information and communication technology and innovation and invention have positive and significant effects on the economic complexity of Iran. Therefore, it is recommended to take serious measures in order to connect the universities and industry and provide practical training to prepare students for entering the industry and the country products.