Egypt beyond the crisis : medium-term challenges for sustained growth
AbstractThe paper analyzes the impact of the recent global crisis in the context of the previous two decades'growth and capital flows. Growth decomposition exercises show that Egyptian growth is driven mostly by capital accumulation. To estimate the share of labor in national income, the analysis adjusts the national accounts statistics to include the compensation of self-employed and non-paid family workers. Still, the share of labor, about 30 percent, is significantly lower than previously estimated. The authors estimate the output costs of the current crisis by comparing the output trajectory that would have prevailed without the crisis with the observed and revised gross domestic product projections for the medium term. The fall in private investment was the main driver of the output cost. Even if private investment recovers its pre-crisis levels, there is a permanent loss in gross domestic product per capita of about 2 percent with respect to the scenario without the crisis. The paper shows how the shock to investment is magnified due to the capital-intensive nature of the Egyptian economy: if the economy had the traditionally-used share of labor in income (40 percent), the output loss would have been reduced by half.
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 5451.
Date of creation: 01 Oct 2010
Date of revision:
Economic Theory&Research; Debt Markets; Access to Finance; Emerging Markets; Banks&Banking Reform;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-30 (All new papers)
- NEP-ARA-2010-10-30 (MENA - Middle East & North Africa)
- NEP-FDG-2010-10-30 (Financial Development & 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.:
- Koop, Gary & Pesaran, M. Hashem & Potter, Simon M., 1996. "Impulse response analysis in nonlinear multivariate models," Journal of Econometrics, Elsevier, vol. 74(1), pages 119-147, September.
- Juan Carlos Conesa & Timothy J. Kehoe & Kim J. Ruhl, 2007.
"Modeling great depressions: the depression in Finland in the 1990s,"
Federal Reserve Bank of Minneapolis, issue Nov, pages 16-44.
- Juan Carlos Conesa & Timothy J. Kehoe & Kim J. Ruhl, 2007. "Modeling great depressions: the depression in Finland in the 1990s," Staff Report 401, Federal Reserve Bank of Minneapolis.
- Juan Carlos Conesa & Timothy J. Kehoe & Kim J. Ruhl, 2007. "Modeling Great Depressions: The Depression in Finland in the 1990s," NBER Working Papers 13591, National Bureau of Economic Research, Inc.
- Pritchett, Lant, 2000.
"The tyranny of concepts - CUDIE (Cumulated, Depreciated Investment Effort) is NOT capital,"
Policy Research Working Paper Series
2341, The World Bank.
- Pritchett, Lant, 2000. " The Tyranny of Concepts: CUDIE (Cumulated, Depreciated, Investment Effort) Is Not Capital," Journal of Economic Growth, Springer, vol. 5(4), pages 361-84, December.
- Rice, Patricia & Venables, Anthony J. & Patacchini, Eleonora, 2006.
"Spatial determinants of productivity: Analysis for the regions of Great Britain,"
Regional Science and Urban Economics,
Elsevier, vol. 36(6), pages 727-752, November.
- Patricia Rice & Anthony J. Venables, 2004. "Spatial Determinants of Productivity: Analysis for the Regions of Great Britain," CEP Discussion Papers dp0642, Centre for Economic Performance, LSE.
- Patricia Rice & Tony Venables, 2004. "Spatial determinants of productivity: analysis for the regions of Great Britain," LSE Research Online Documents on Economics 2040, London School of Economics and Political Science, LSE Library.
- Rice, Patricia & Venables, Anthony J., 2004. "Spatial Determinants of Productivity: Analysis for the Regions of Great Britain," CEPR Discussion Papers 4527, C.E.P.R. Discussion Papers.
- Arestoff, Florence & Hurlin, Christophe, 2006.
"Estimates of government net capital stocks for 26 developing countries, 1970-2002,"
Policy Research Working Paper Series
3858, The World Bank.
- Hurlin, Christophe & Arestoff, Florence, 2006. "Estimates of Government Net Capital Stocks for 26 Developing Countries, 1970-2002," Economics Papers from University Paris Dauphine 123456789/1648, Paris Dauphine University.
- Maurice Obstfeld & Kenneth S. Rogoff, 1996. "Foundations of International Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262150476, December.
- Reinhart, Carmen & Talvi, Ernesto, 1998.
"Capital flows and saving in Latin America and Asia: A reinterpretation,"
13704, University Library of Munich, Germany.
- Reinhart, Carmen M. & Talvi, Ernesto, 1998. "Capital flows and saving in Latin America and Asia: a reinterpretation," Journal of Development Economics, Elsevier, vol. 57(1), pages 45-66, October.
- Fatás, Antonio & Mihov, Ilian, 2002.
"The Case for Restricting Fiscal Policy Discretion,"
CEPR Discussion Papers
3277, C.E.P.R. Discussion Papers.
- Peeters, Marga, 2011. "Demographic pressure, excess labour supply and public-private sector employment in Egypt - Modelling labour supply to analyse the response of unemployment, public finances and welfare," MPRA Paper 31101, University Library of Munich, Germany.
- Constantino Hevia & Norman Loayza, 2012.
"Saving And Growth In Egypt,"
Middle East Development Journal (MEDJ),
World Scientific Publishing Co. Pte. Ltd., vol. 4(01), pages 1250002-1-1.
- Marga Peeters, 2011. "Modelling unemployment in the presence of excess labour supply," Journal of Economics and Econometrics, Economics and Econometrics Research Institute (EERI), Brussels, vol. 54(2), pages 58-92.
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.