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Potential Output and total Factor Productivity Growth in Post-Apartheid South Africa
Author: Mr. Vivek B. Arora and Mr. Ashok Bhundia
Series:
IMF Working Papers
Volume/Issue:
Volume 2003: Issue 178
Language:
English
Publication Date:
01 Sep 2003
DOI:
https://doi.org/10.5089/9781451858976.001
ISBN:
9781451858976
ISSN:
1018-5941
Pages:
21
Keywords:
WP; inflation; estimate; Potential output; output gap; total factor productivity; South Africa; output gap measure; production function approach; estimates of the output gap; output gap methodology; potential GDP; Capacity utilization; Production growth; Africa
Legal-disclaimer:
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 provides estimates of potential output growth in post-apartheid South Africa using both time trend techniques and a production function approach which indicates a potential growth rate of around 3 percent. The implied output gap provides statistically significant information for predicting inflation and could thus provide valuable input for formulating macroeconomic policy. Growth accounting and regression analysis suggest that an increase in trend GDP growth after the end of apartheid in 1994 is attributable to higher TFP growth driven by trade liberalization and greater private sector participation.
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund