Indexing Structural Distortion: Sectoral Productivity, Structural Change and Growth

Author/Editor:

Sakai Ando ; Koffie Ben Nassar

Publication Date:

September 19, 2017

Electronic Access:

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Summary:

This paper proposes a new index of sectoral labor distortion using employment and valueadded shares. We show that this index is highly correlated with growth both crosssectionally and over time. We also use it to compare the degree of distortion among countries and identify sectors where the potential payoffs in terms of growth from reforms could be large. The regression analysis in the paper shows that education and various structural reforms have potential to improve the efficiency of sectoral labor allocation.

Series:

Working Paper No. 2017/205

Subject:

English

Publication Date:

September 19, 2017

ISBN/ISSN:

9781484319277/1018-5941

Stock No:

WPIEA2017205

Pages:

48

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