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Working Paper 360 - Total factor productivity and growth strategy in Cabo-Verde

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Abstract

In the mid-2010s, Cabo Verde embarked on a growth paradigm shift, positioning the private sector as the key driver of economic activity. For this policy to succeed, productivity considerations are key. This paper estimates and analyses the evolution of Total Factor Productivity (TFP) for Cabo Verde. Our analysis shows that both physical capital and labour have had a positive contribution to growth, but during 1980– 1987 and 2007–2014 the contribution of TFP was negative. In addition, it underscores the importance of private sector competitiveness for TFP. If productivity concerns are not addressed, Cabo Verde can expect growth to decline in the long term. But the policies presented in the country’s latest development strategy seem adequate to respond to structural challenges.

Suggested Citation

  • Cassandro Mendes & Yannis Arvanitis, 2021. "Working Paper 360 - Total factor productivity and growth strategy in Cabo-Verde," Working Paper Series 2486, African Development Bank.
    • Handle: RePEc:adb:adbwps:2486
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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