Cover IMF Working Papers
Factor Reallocation and Growth in Developing Countries
Series:
IMF Working Papers
Volume/Issue:
Volume 2000: Issue 094
Language:
English
Publication Date:
01 Jun 2000
DOI:
https://doi.org/10.5089/9781451851717.001
ISBN:
9781451851717
ISSN:
1018-5941
Pages:
29
Keywords:
WP; Factor reallocation; dualism; growth; labor productivity; reallocation effect; labor reallocation; labor coefficient; factor productivity; GDP growth; Labor productivity; Public expenditure review; Human capital; Capital productivity; Sub-Saharan Africa; South Asia; East Asia
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper examines the extent to which developing countries benefit from intersectoral factor transfers by specifying the impact and determinants of sectoral changes and of the degree of dualism (or allocation inefficiency) in a dual economy model. Conditions under which factor reallocation is growth-enhancing are derived. An empirical error-correction equation is estimated for 30 developing countries during 1965-80. Results suggest that labor reallocation effects are especially important in countries with high rates of investment (and thus high rates of labor transfer) and/or at low levels of development (and thus high degrees of dualism).
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 2000: Issue 094