An examination of the sources of economic growth in Cameroon

Using the aggregate production function as the basic model, the study examines the main components of Cameroon’s growth rates between 1961 and 1997 and the driving force behind the sources of growth in the economy. Both parametric and non-parametric approaches are used.The results show that the contribution of the growth of factor inputs is greater than the contribution of total factor productivity, with capital input playing a larger role. At the sector level, input growth greatly influenced the primary sector output growth. The capital input tends to be the most important factor influencing output growth in both the secondary and tertiary sectors. In these two sectors, labour’s role is not effectively used or has not been boosted to effectively perform its crucial role in the economy. In developed economies studies show that total factor productivity growth plays a greater role than factor input growth. The results here suggest that factor inputs play more important roles than total factor productivity (TFP) growth with emphasis on increasing return to scale and input growth both in quantity and quality. The technology factor is not a big contributor to growth in Cameroon, which may be because of certain constraints in the economy. The results do show high growth rate of total factor productivity, thus suggesting the potential and growing importance of TFP in the growth process. Policies that would improve the quality of factor input, particularly labour, would tend to enhance the contribution of total factor productivity. Hence the policy implications are to improve human capital development as the main mover of other factors in the economy.