Drivers of Economic Growth in MENA Countries: Empirical Analysis of Endogenous Growth Accounting

Articles in Press

Document Type : Research Paper

Authors

1 Azad

2 Economic Department, Islamic Azad University, Firoozkooh Branch

3 Assistant Professor, Firuzkuh Branch. Islamic Azad University,

4 Firuzkuh Branch. Islamic Azad University

10.22051/ieda.2024.47863.1430

Abstract

In this article, the drivers of economic growth in the Mena region were evaluated using the standard and new growth accounting method in the period of 2010-2019. the average contribution of inputs to growth is 82.8%. Of this amount, the average share of capital stock was 52.2% and the average share of labor force was 30.6%. Therefore, about three over five of economic growth occurs through capital. In standard growth accounting, the contribution of inputs to growth is 86.8%. The annual average share of input productivity is 14.7 percent. From this amount, the average productivity share of capital augmented technology is 10.6% and the average productivity share of labor augmented technology is estimated to be 1.4%. The annual average share of in growth is 1.7%, which is the result of two factors of technical efficiency change and technological progress. The average annual share of TFP in standard and new growth accounting is 13.5% and 21.8%, respectively. Therefore, the estimation of TFP share in the standard method is associated with a low estimation error. There are signs of the impact of technology on capital and labor productivity. In some years, its share has increased to 10% (capital augmented technology). Along with this phenomenon, technology has improved labor productivity by about 9% (labor augmented technology). Based on this, orientation towards knowledge-based economy and sectors with high added value along with more benefit from high skilled human capital will play an important role in achieving sustainable economic growth in these countries.

Keywords

Main Subjects

Iranian Economic Development Analyses

Articles in Press, Accepted Manuscript
Available Online from 24 December 2024

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