Economic diversity or economic diversification refers to variations in the economic status or the use of a broad range of economic activities in a region or country. Diversification is used as a strategy to encourage positive
economic growth
In economics, economic growth is an increase in the quantity and quality of the economic goods and Service (economics), services that a society Production (economics), produces. It can be measured as the increase in the inflation-adjusted Outp ...
and development.
Research shows that more diversified economies are associated with higher levels of
gross domestic product
Gross domestic product (GDP) is a monetary measure of the total market value of all the final goods and services produced and rendered in a specific time period by a country or countries. GDP is often used to measure the economic performanc ...
.
Economic Diversification types
# Non-connected diversification – creating a new area. The process is slow, because it is needed to create a whole infrastructure, but the profit would be higher.
# Connected diversification is based on an economical mechanism for expanding the available potential. For business development it means low risks and good margin.
# Combined diversification – more frequently both methods are used together.
Diversification examples in countries
Good examples of national economy diversification are
Chile
Chile, officially the Republic of Chile, is a country in western South America. It is the southernmost country in the world and the closest to Antarctica, stretching along a narrow strip of land between the Andes, Andes Mountains and the Paci ...
,
Malaysia
Malaysia is a country in Southeast Asia. Featuring the Tanjung Piai, southernmost point of continental Eurasia, it is a federation, federal constitutional monarchy consisting of States and federal territories of Malaysia, 13 states and thre ...
and
Brazil
Brazil, officially the Federative Republic of Brazil, is the largest country in South America. It is the world's List of countries and dependencies by area, fifth-largest country by area and the List of countries and dependencies by population ...
.
See also
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Diversification (marketing strategy)
Diversification is a corporate strategy to enter into or start new products or product lines, new services or new markets, involving substantially different skills, technology and knowledge.
Diversification is one of the four main growth strategi ...
*
Commodity dependence
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Financial inclusion
Financial inclusion is the availability and equality of opportunities to access financial services. It refers to processes by which individuals and businesses can access appropriate, affordable, and timely financial products and services—which ...
*
Western Economic Diversification Canada
In Canada, the Regional Development Agencies (RDA) are the seven Government of Canada, federal government agencies responsible for addressing key economic challenges and furthering economic development, Economic diversification, diversification, an ...
References
Distribution of wealth
Strategic management
Economic development policy
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