Combine the flour, cold butter, and pecans in a bowl. Press this mixture firmly into the bottom of a 9×13 inch baking dish to form the crust.
Bake the crust for 15 minutes. Let it cool completely.
In a medium bowl, beat the softened cream cheese and powdered sugar until smooth. Fold in 1 cup of the whipped topping. Spread this mixture evenly over the cooled crust.
In a separate bowl, whisk together the instant butterscotch pudding mix and the cold milk until thickened, about 2 minutes. Spread the pudding mixture over the cream cheese layer.
Top the pudding layer with the remaining whipped topping.
Sprinkle the butterscotch chips evenly over the top layer.
Chill the dessert in the refrigerator for at least 4 hours, or preferably overnight, before slicing and serving.
Notes
For a richer flavor, you can substitute instant vanilla pudding for the butterscotch pudding and add 1 teaspoon of butterscotch extract to the pudding layer.
This dessert freezes well if you need to make it ahead of time for holiday layered desserts.
Use real butter in the crust for the best texture in this layered butterscotch dessert.