Development opportunities: economic complexity as a driver for São Paulo

Abstract

Abstract The study analyzes the growth and development opportunities for cities in the Brazilian state of São Paulo, considering economic complexity. Our hypothesis is that the structural heterogeneity in Brazil, and in São Paulo, creates regional inequality. Therefore, cities have different development trajectories depending on their current economic capacities and productive structures. The level of economic complexity is the measurement of an economy’s ability to produce goods with a higher (or lower) level of embedded knowledge. Applying this theory to cities in the state of São Paulo indicates substantially unequal levels of complexity in the state territory, with the best indicators centered around cities such as São Paulo and Campinas. A correlation was found between the municipalities’ current level of complexity, their levels of production, and complexity outlook. Thus, based on the opportunities presented for each municipality and their engagement in this transformation process, cities will develop at different speeds and inequalities will emerge.