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Economic Restructuring and Total Factor Productivity Growth: Tunisia over the Period 1983-2001

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  • Sofiane Ghali

    (Faculté des Sciences Economiques et de Gestion de Nabeul, University of 7 November)

  • Pierre Mohnen

Abstract

In this paper we aim to measure and decompose the growth of frontier total factor productivity (TFP) in Tunisia over the period 1983-2001. We define frontier TFP growth as the shift of the economy’s production frontier, which we obtain by solving for each year a linear program, a sort of aggregate DEA analysis. We then decompose this aggregate frontier TFP growth into changes in technology, terms of trade, efficiency and resource utilization. We also attribute frontier TFP growth to its main beneficiaries: labor, decomposed into five types, capital, decomposed into two types, and the allowable trade deficit. We find that frontier TFP grew by about 1% a year after the introduction of the structural adjustment program of 1987. Labor—in particular unskilled labor—was the main beneficiary of frontier TFP growth. The Solow residual reflecting technological change was the main driver of frontier TFP growth. The terms of trade were not favorable to Tunisia. After 1992, while the Tunisian efficiency frontier moved outwards, the country moved away from its efficiency frontier.

Suggested Citation

  • Sofiane Ghali & Pierre Mohnen, 2010. "Economic Restructuring and Total Factor Productivity Growth: Tunisia over the Period 1983-2001," Working Papers 572, Economic Research Forum, revised 11 Jan 2010.
    • Handle: RePEc:erg:wpaper:572
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    Cited by:

    1. Sofiane Ghali & Habib Zitouna & Zouhour Karray & Slim Driss, 2013. "Trade, Transaction Costs and TFP: Evidence from Tunisia and Egypt," Working Papers 807, Economic Research Forum, revised Dec 2013.

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    More about this item

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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