Significant drivers of growth in Africa

Oleg Badunenko, Daniel J. Henderson, Romain Houssa

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    Abstract

    We employ bootstrap techniques in a production frontier framework to provide statistical inference for each component in the decomposition of labor productivity growth, which has essentially been ignored in this literature. We show that only two of the four components (efficiency changes and human capital accumulation) have significantly contributed to growth in Africa. Although physical capital accumulation is the largest force, it is not statistically significant on average. Thus, ignoring statistical significance would falsely identify physical capital accumulation as a major driver of growth in Africa when it is not.
    Original languageEnglish
    Pages (from-to)339-354
    Number of pages16
    JournalJournal of Productivity Analysis
    Volume42
    Issue number3
    Early online date27 Jul 2014
    DOIs
    Publication statusPublished - 1 Dec 2014

    Keywords

    • Africa
    • bootstrap
    • growth
    • production frontier

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