Sector growth and the dual economy model - evidence from Cote d'Ivoire, Ghana, and Zimbabwe
AbstractThe authors analyze and compare sectoral growth in three African economies - Cote d'Ivoire, Ghana and Zimbabwe - since 1965. They extend the classic dual economy - the agriculture and industry sectors - by adding the services sector. For all the three countries, they find at least one statistically significant long-run relationship for sectoral GDP. This indicates a large degree of interdependence in long-run growth among the three sectors. This also provides evidence against the basic dual economy model, which implies that a long-run relationship cannot exist between agricultural and industrial output. Analysis of the impulse response and analysis of short-run sectoral growth support the results on the interdependence of sectoral growth. Both imply that a positive link exists between growth in industry and growth in agriculture. Their findings contradict the literature on the dual economy - and suggest that more attention should be paid to inter-sectoral dynamics and dependencies in Sub-Saharan Africa. Why? Because an adverse shock in, say, agriculture after a drought is likely to have an adverse impact on the other economic sectors. Policymakers should try to accommodate not only the initial shock in agriculture but also its adverse effects in other sector. They find that focusing mainly on industry was not optimal policy in Cote d'Ivoire, Ghana, and Zimbabwe. For maximum economy-wide growth, it would have been better to balance policies to include all three sectors: agriculture, industry, and services.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 2175.
Date of creation: 30 Sep 1999
Date of revision:
Public Health Promotion; Agricultural Knowledge&Information Systems; Water and Industry; Health Monitoring&Evaluation; Economic Theory&Research; Health Monitoring&Evaluation; Governance Indicators; Water and Industry; Economic Theory&Research; Achieving Shared Growth;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- repec:fth:stanho:e-92-3 is not listed on IDEAS
- Robert J. Barro, 1991.
"Economic Growth in a Cross Section of Countries,"
NBER Working Papers
3120, National Bureau of Economic Research, Inc.
- Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-80, November.
- Storm, Servaas, 1997. "Domestic constraints on export-led growth: a case-study of India," Journal of Development Economics, Elsevier, vol. 52(1), pages 83-119, February.
- Martin, Will & Mitra, Devashish, 1999. "Productivity growth and convergence in agriculture and manufacturing," Policy Research Working Paper Series 2171, The World Bank.
- Matsuyama, Kiminori, 1992.
"Agricultural productivity, comparative advantage, and economic growth,"
Journal of Economic Theory,
Elsevier, vol. 58(2), pages 317-334, December.
- Kiminori Matsuyama, 1990. "Agricultural Productivity, Comparative Advantage, and Economic Growth," Discussion Papers 934, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Kiminori Matsuyama, 1991. "Agricultural Productivity, Comparative Advantage and Economic Growth," NBER Working Papers 3606, National Bureau of Economic Research, Inc.
- Montiel, Peter J, 1996.
"Financial Policies and Economic Growth: Theory, Evidence and Country-Specific Experience from Sub-Saharan Africa,"
Journal of African Economies,
Centre for the Study of African Economies (CSAE), vol. 5(3), pages 65-98, October.
- Montiel, P.J., 1995. "Financial Policies and Economic Growth: Theory, Evidence and Country-Specific Experience from Sub-Saharan Africa," Papers 18s, African Economic Research Consortium.
- Canning, David J, 1988. "Increasing Returns in Industry and the Role of Agriculture in Growth," Oxford Economic Papers, Oxford University Press, vol. 40(3), pages 463-76, September.
- Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
- Munisamy Gopinath & Terry L. Roe & Mathew D. Shane, 1996. "Competitiveness of U.S. Food Processing: Benefits from Primary Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(4), pages 1044-1055.
- Skott, Peter & Larudee, Mehrene, 1998. "Uneven Development and the Liberalisation of Trade and Capital Flows: The Case of Mexico," Cambridge Journal of Economics, Oxford University Press, vol. 22(3), pages 277-95, May.
- Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-76, March.
- repec:pra:mprapa:25503 is not listed on IDEAS
- Diao, Xinshen & Hazell, Peter & Thurlow, James, 2010. "The Role of Agriculture in African Development," World Development, Elsevier, vol. 38(10), pages 1375-1383, October.
- Liao, Christine Marie & Pasadilla, Gloria O., 2007.
"Has Liberalization Strengthened the Link between Services and Manufacturing?,"
DP 2007-13, Philippine Institute for Development Studies.
- Gloria O. Pasadilla & Christine Marie M. Liao, 2007. "Has Liberalization Strengthened the Link between Services and Manufacturing?," Microeconomics Working Papers 22047, East Asian Bureau of Economic Research.
- Gloria O. Pasadilla & Christine Marie M. Liao, 2007. "Has Liberalization Strengthened the Link between Services and Manufacturing?," Working Papers 4807, Asia-Pacific Research and Training Network on Trade (ARTNeT), an initiative of UNESCAP and IDRC, Canada..
- Bigsten , Arne & Levin, Jörgen, 2000.
"Growth, Income Distribution, and Poverty: A Review,"
Working Papers in Economics
32, University of Gothenburg, Department of Economics.
- Arne Bigsten & JÃ¶rgen Levin, 2010. "Growth, Income Distribution, and Poverty: A Review," Working Papers id:3296, eSocialSciences.
- Bigsten, Arne & Levin, Jorgen, 2001. "Growth, Income Distribution, and Poverty: A Review," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Eric Manes, 2009. "Pakistan's Investment Climate : Laying the Foundation for Growth, Volume 2. Annexes," World Bank Other Operational Studies 12411, The World Bank.
- Fiess, Norbert M. & Verner, Dorte, 2001. "Intersectoral dynamics and economic growth in Ecuador," Policy Research Working Paper Series 2514, The World Bank.
- Roland CRAIGWELL & Darrin DOWNES & Kevin GREENIDGE & Keva STEADMAN, 2008. "Sectoral Output, Growth And Economic Linkages In The Barbados Economy Over The Past Five Decades," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 8(2), pages 123-136.
- Verner, Dorte & Fiess, Norbert M., 2003. "Oil, agriculture, and the public sector: linking intersector dynamics in Ecuador," Policy Research Working Paper Series 3094, The World Bank.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).
If references are entirely missing, you can add them using this form.