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Are developing countries accumulating sufficient total factor productivity to sustain their economic growth and job creation? Empirical evidence from the Middle East and North Africa region

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  • Mohamad Ahmad Abou Hamia

Abstract

This study contributes new evidence on why the Middle East and North Africa (MENA) region has failed to create decent jobs for decades. The growth accounting exercise reveals that the region suffered from an acute total factor productivity (TFP) deficit in the 1990s; it improved remarkably in the 2000s, before deteriorating significantly in the period between 2010 and 2017. Throughout the three subperiods, the region’s growth relied heavily on capital accumulation. The severe deficit in TFP and the heavy reliance on physical capital for decades impaired the region’s ability to sustain economic growth and to create decent jobs in the long run. The study recommends more government interventions in knowledge accumulation as a critical precondition for employment generation in developing countries.

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  • Mohamad Ahmad Abou Hamia, 2020. "Are developing countries accumulating sufficient total factor productivity to sustain their economic growth and job creation? Empirical evidence from the Middle East and North Africa region," Review of Development Economics, Wiley Blackwell, vol. 24(3), pages 1102-1127, August.
    • Handle: RePEc:bla:rdevec:v:24:y:2020:i:3:p:1102-1127
    DOI: 10.1111/rode.12693
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    2. Romel Ramón González-Díaz & Ángel Acevedo-Duque & Guido Salazar-Sepúlveda & Dante Castillo, 2021. "Contributions of Subjective Well-Being and Good Living to the Contemporary Development of the Notion of Sustainable Human Development," Sustainability, MDPI, vol. 13(6), pages 1-17, March.
    3. Hongyun Zheng & Wanglin Ma, 2021. "The role of resource reallocation in promoting total factor productivity growth: Insights from China’s agricultural sector," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 2350-2371, November.
    4. Daňová Monika & Vozárová Ivana Kravčáková, 2021. "Does the instability of economic development affect the elasticity of the labour market?," Review of Economic Perspectives, Sciendo, vol. 21(3), pages 291-308, September.

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