@report {1331896,
	title = {How Industry-Related Capabilities Affect Export Possibilities},
	year = {2017},
	institution = {Growth Lab at Harvard{\textquoteright}s Center for International Development},
	address = {Cambridge},
	abstract = {
	The central question we will explore in this document is: Can we anticipate the opportunities that Colombian\&nbsp;cities have to export specific products based on their existing productive capabilities?



	In the following pages, we report a collection of results, analyses, and advances in which we assess how\&nbsp;industry-related capabilities affect export possibilities. Our final goal will be to create a single measure that\&nbsp;synthesizes all the knowledge and existing information about the productive capabilities of each city, both\&nbsp;{\textquotedblleft}horizontal{\textquotedblright} and {\textquotedblleft}vertical{\textquotedblright}, and that quantifies how competitive a city can be if it aims at exporting a given\&nbsp;product it does not yet export.



	This document is broken in two main efforts: First, we want to understand the {\textquotedblleft}mechanics{\textquotedblright} of diversification\&nbsp;processes. And second, we want to be able to provide recommendations of products that are not\&nbsp;produced in cities, but should be. The first effort requires a multitude of analyses, each trying to describe\&nbsp;the characteristics of firms, of cities, and of the mechanisms that expand the export baskets of places. The\&nbsp;second effort requires the development of a statistical model that is accurate when predicting the appearances\&nbsp;of products in cities. These two efforts, explaining and predicting, are complementary, but different.



	Explanations that lack the power of accurately predicting the future are useless in practice; predictions of\&nbsp;phenomena for which we lack understanding are dangerous. But together they provide a unified story that\&nbsp;can inform policy decisions.

},
	author = {Sid Ravinutala and Andres Gomez-Lievano and Eduardo Lora}
}
