Saturday, December 3, 2011

Factor Growth in Africa

According to the World Bank, annual GDP growth in African countries has been higher than that of East Asian countries for the past 10 years . This suggests that Africa is converging on its historically more successful neighbor, East Asia. So what could be fueling this growth? We have learned that output growth can be produced by either growth in factors of production or growth in efficiency. On the factor side, investments in capital, new roads, and technology have contributed to factor growth. In 2010 foreign investors, invested $55 billion in African projects. While the population size is expected to grow as death rates are reduced, contributing to the growth of labor supply.
So does factor growth account for all of Africa's growth or have efficiency gains been made as well?
http://www.economist.com/node/21541008

No comments:

Post a Comment