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How can we double per capita incomes in Bangladesh in 15 years?

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  • Rao, B. Bhaskara
  • Hassan, Gazi

Abstract

This paper develops a framework to analyse the determinants of the long term growth rate of Bangladesh. It is based on the Solow (1956) growth model and its extension by Mankiw, Romer and Weil (1992) and follows Senhadji’s (2000) growth accounting procedure to estimate total factor productivity (TFP). Our growth accounting exercise shows that growth rate in Bangladesh, until the 1990s was primarily due to factor accumulation. Since then, however, TFP has made a small positive contribution. An analysis of the determinants of TFP shows that remittances by emigrant workers has no significant long run growth effect. Using our results on the determinants of TFP we examine policy options to double per capita income of Bangladesh in about 15 years.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 17302.

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Date of creation: 15 Sep 2009
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Handle: RePEc:pra:mprapa:17302

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Keywords: Solow Growth Model; Total Factor Productivity; Growth Accounting; South Asia; Bangladesh.;

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  1. B. Bhaskara Rao & Rup Singh & Saten Kumar, 2010. "Do we need time series econometrics?," Applied Economics Letters, Taylor & Francis Journals, vol. 17(7), pages 695-697.
  2. Serena Ng & Pierre Perron, 2001. "LAG Length Selection and the Construction of Unit Root Tests with Good Size and Power," Econometrica, Econometric Society, vol. 69(6), pages 1519-1554, November.
  3. Rao, B. Bhaskara & Cooray, Arusha, 2008. "Growth literature and policies for the developing countries," MPRA Paper 10951, University Library of Munich, Germany.
  4. David F. Hendry & Hans-Martin Krolzig, 2005. "The Properties of Automatic "GETS" Modelling," Economic Journal, Royal Economic Society, vol. 115(502), pages C32-C61, 03.
  5. Elliott, Graham & Rothenberg, Thomas J & Stock, James H, 1996. "Efficient Tests for an Autoregressive Unit Root," Econometrica, Econometric Society, vol. 64(4), pages 813-36, July.
  6. Mark Rogers, 2003. "A Survey of Economic Growth," The Economic Record, The Economic Society of Australia, vol. 79(244), pages 112-135, 03.
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