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Economic Growth in Egypt: Constraints and Determinants

Author

Listed:
  • Anton Dobronogov

    (World Bank)

  • Farrukh Iqbal

    (World Bank)

Abstract

Egypt accelerated its ongoing transition from a public sector dominated economy to a private sector led and market oriented economy after the collapse of oil prices in the mid-1980s. Some aspects of the economy, such as trade policy, have been substantially transformed since then whereas other aspects, such as public control of the financial sector, have experienced less change in substance. We examine some determinants of growth in Egypt since the mid-1980s using insights from both standard econometric techniques and a diagnostic approach proposed by Hausmann, Rodrik and Velasco (2004). We find that trends in government consumption, credit to the private sector and the average growth rate of OECD countries have been significant determinants of growth in Egypt in the past. We also present evidence that suggests that inefficiency of financial intermediation is a significant current constraint on growth.

Suggested Citation

  • Anton Dobronogov & Farrukh Iqbal, 2005. "Economic Growth in Egypt: Constraints and Determinants," Development and Comp Systems 0512024, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpdc:0512024
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    References listed on IDEAS

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    1. Easterly, William & Kremer, Michael & Pritchett, Lant & Summers, Lawrence H., 1993. "Good policy or good luck?: Country growth performance and temporary shocks," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 459-483, December.
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    Cited by:

    1. Luisanna Onnis & Patrizio Tirelli, 2010. "Challenging the popular wisdom. New estimates of the unobserved economy," Working Papers 184, University of Milano-Bicocca, Department of Economics, revised Apr 2010.
    2. Soliman, Ibrahim & Mashhour, Ahmed & Gaber, Mohamed, 2011. "A review of The National and International Agro‐Food Policies and Institutions in Egypt," MPRA Paper 66779, University Library of Munich, Germany, revised 15 May 2011.
    3. Brach Juliane, 2010. "Technology, Political Economy, and Economic Development in the Middle East and North Africa," Review of Middle East Economics and Finance, De Gruyter, vol. 5(3), pages 1-23, February.
    4. Bargawi Hannah, 2014. "Economic Policies, Structural Change and the Roots of the “Arab Spring” in Egypt," Review of Middle East Economics and Finance, De Gruyter, vol. 10(3), pages 1-28, December.
    5. Brach, Juliane, 2008. "Constraints to Economic Development and Growth in the Middle East and North Africa," GIGA Working Papers 85, GIGA German Institute of Global and Area Studies.
    6. Mr. Klaus-Stefan Enders, 2007. "Egypt—Searching for Binding Constraints on Growth," IMF Working Papers 2007/057, International Monetary Fund.
    7. Ammar Jreisat & Hassan Hassan, 2016. "Banking efficiency in Egypt: an application of data envelopment," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 11(2), pages 101-119.
    8. Shima'a Hanafy & Marcus Marktanner, 2015. "Sectoral FDI, Absorptive Capacity and Economic Growth — Empirical Evidence from Egyptian Governorates," MAGKS Papers on Economics 201537, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    9. Kamal, Mona, 2013. "Financial Development and Economic Growth in Egypt: A Re-investigation," MPRA Paper 48564, University Library of Munich, Germany.
    10. World Bank, . "Arab Republic of Egypt : Poverty Assessment Update, Volume 1. Main Report," World Bank Other Operational Studies, The World Bank, number 7642, April.

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    More about this item

    Keywords

    Economic growth; Egypt; growth diagnostic; binding constraint; financial intermediation;
    All these keywords.

    JEL classification:

    • O - Economic Development, Innovation, Technological Change, and Growth
    • P - Economic Systems

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