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Productivity Growth and Structural Reform in Bulgaria: Restarting the Convergence Engine

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  • Mr. Cyril Pouvelle
  • Ms. Pritha Mitra

Abstract

Labor productivity levels in Bulgaria lag well behind that in the EU, weighing on the convergence process. Stronger productivity growth would allow Bulgaria to close the income gap with the EU average more quickly and to alleviate the structural problems in its labor market, reflected in its high long–term and youth unemployment. Our analysis of the drivers of labor productivity suggest that for Bulgaria closing the gap with EU standards in the areas of institutional and infrastructure quality, goods market efficiency, higher education, and innovation would permanently boost productivity growth by a total of 1 percentage point a year. This would be enough to close the income gap with the EU average by 2040, compared to the status quo where it would take an additional 10 years.

Suggested Citation

  • Mr. Cyril Pouvelle & Ms. Pritha Mitra, 2012. "Productivity Growth and Structural Reform in Bulgaria: Restarting the Convergence Engine," IMF Working Papers 2012/131, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2012/131
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    References listed on IDEAS

    as
    1. Bourles, Renaud & Cette, Gilbert, 2007. "Trends in "structural" productivity levels in the major industrialized countries," Economics Letters, Elsevier, vol. 95(1), pages 151-156, April.
    2. Belorgey, Nicolas & Lecat, Remy & Maury, Tristan-Pierre, 2006. "Determinants of productivity per employee: An empirical estimation using panel data," Economics Letters, Elsevier, vol. 91(2), pages 153-157, May.
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    Cited by:

    1. Dimitrov, Kiril & Geshkov, Marin, 2018. "Dominating Attributes Of Professed Firm Culture Of Holding Companies – Members Of The Bulgarian Industrial Capital Association," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 12(3), pages 384-418.
    2. Alfred Sitz & Aneliya Adzhemova & Atanas Pekanov, 2013. "Bulgarien: wirtschaftspolitische Strategie und ökonomische Entwicklung seit der Öffnung," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 39(1), pages 69-85.
    3. George H. Ionescu & Elena Jianu & Ioana C. Patrichi & Florin Ghiocel & Lili Țenea & Delia Iancu, 2021. "Assessment of Sustainable Development Goals (SDG) Implementation in Bulgaria and Future Developments," Sustainability, MDPI, vol. 13(21), pages 1-33, October.
    4. Didit Welly UDJIANTO & Joko SUSANTO & PURWIYANTA, 2019. "Infrastructure, Employment And Income Convergence," Romanian Journal of Economics, Institute of National Economy, vol. 49(2(58)), pages 50-61, December.
    5. repec:clr:wugarc:y:2013:v:39i:1p:69 is not listed on IDEAS
    6. Iana Paliova & Mr. Tonny Lybek, 2014. "Bulgaria’s EU Funds Absorption: Maximizing the Potential!," IMF Working Papers 2014/021, International Monetary Fund.

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