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Growth Accelerations, Structural Change and Poverty Reduction in Africa

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  • Jean-Claude BERTHELEMY

    () (Université Paris I Panthéon-Sorbonne)

Abstract

This paper proposes an assessment of African countries’ growth patterns through the identification of acceleration episodes. About two-thirds of African countries have experienced at least one growth acceleration episode since the 1950s. In some cases, accelerations hardly contributed to long-term growth, as they led or lagged a crisis episode, but in most cases, which we define as growth spike episodes, growth accelerations have directly determined the long-run pattern of growth. Hence studying these growth spike episodes specifically contributes to better understanding of African growth performance. We observe several cases of multiple growth spikes, similar to what has been observed in emerging economies. Growth spike episodes are generally associated with substantial total factor productivity gains. They are also associated with reduction of dualism through sectorial reallocation of labour from low-productivity sectors to high-productivity sectors. Growth spikes are additionally associated with poverty reduction, but we challenge the conventional wisdom that growth causes poverty reduction. In several cases, data on income distribution observed during the growth spike episodes are more consistent with the reverse causation, with poverty reduction causing economic growth. The paper concludes with a policy discussion that emphasizes the necessity of building a pro-poor and shared growth strategy.

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  • Jean-Claude BERTHELEMY, 2018. "Growth Accelerations, Structural Change and Poverty Reduction in Africa," Working Papers 4518, FERDI.
  • Handle: RePEc:fdi:wpaper:4518
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    1. Robert C. Feenstra & Robert Inklaar & Marcel P. Timmer, 2015. "The Next Generation of the Penn World Table," American Economic Review, American Economic Association, vol. 105(10), pages 3150-3182, October.
    2. McMillan, Margaret & Rodrik, Dani & Verduzco-Gallo, Íñigo, 2014. "Globalization, Structural Change, and Productivity Growth, with an Update on Africa," World Development, Elsevier, vol. 63(C), pages 11-32.
    3. Chatterji, Monojit, 1992. "Convergence Clubs and Endogenous Growth," Oxford Review of Economic Policy, Oxford University Press, vol. 8(4), pages 57-69, Winter.
    4. Gaaitzen de Vries & Marcel Timmer & Klaas de Vries, 2015. "Structural Transformation in Africa: Static Gains, Dynamic Losses," Journal of Development Studies, Taylor & Francis Journals, vol. 51(6), pages 674-688, June.
    5. Morten O. Ravn & Harald Uhlig, 2002. "On adjusting the Hodrick-Prescott filter for the frequency of observations," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 371-375.
    6. Michael Carter & Christopher Barrett, 2006. "The economics of poverty traps and persistent poverty: An asset-based approach," Journal of Development Studies, Taylor & Francis Journals, vol. 42(2), pages 178-199.
    7. Barry Eichengreen & Donghyun Park & Kwanho Shin, 2013. "Growth Slowdowns Redux: New Evidence on the Middle-Income Trap," NBER Working Papers 18673, National Bureau of Economic Research, Inc.
    8. Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-1085, December.
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