This documents contains proofs that for the sake of brevity have been omitted from the paper " Endogenous Comparative Advantage, " additional calculations, and a discussion about empirical evidence supporting some implications of the model. To make the derivations self-contained some equations have been duplicated from the main paper.

Less developed countries tend to experience higher output volatility, a fact that is in part explained by their specialization in more volatile sectors. This paper proposes theoretical explanations for this pattern of specialization – with the complexity of the goods playing a central role. Specifically, less developed countries with lower institutional ability to enforce contracts, or alternat...

We study the evolution of comparative advantage in a model with two countries and`≥ 2 goods. We show that the stochastically stable set consists of the pattern of production that follows the chain of comparative advantage in a sufficiently large world economy. Also, the chain of comparative advantage has an elegant structure that allows for step-by-step evolution. So convergence towards the equ...