Karl Marx wrote that the “country that is more developed industrially… shows to the less developed the image of its own future…” Karl Marx was wrong.That is not the traditional neoliberal view! Says Chris. [Which I guess now becomes the Paleoneoliberal view]
But the point here is that DeLong is discovering network theory as per Hidalgo-Haussman, which Dani Rodrik discovers in a new paper, referenced by Kling here.
In channel theory we model entrepreneurial force as signal to noise ratio, which in Kling's model is the ability to locate sustainable patterns of trade. The relationship between network theory and channel theory are the discrete number of channel components, N, which increase with SNR. The GDP effect goes as Nlog(N), giving us one of the complexity drivers in Hidalgo-Hausmann formulation. The other driver is Bandwidth, which increases as transaction intervals decrease, usually due to technology.
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