Productivity Change and Growth in Industry and Agriculture: An International Comparison

Abstract

On the supply side, the growth of an economy, an industry, or a firm is determined by the rate of expansion of its productive resources and by improvements in their efficiency; that is, by total factor productivity (TFP) growth. In the short run, where there are limits to how fast employable resources can grow, achieving high rates of productivity change offers an important avenue for accelerating economic growth under resource constraints, while in the medium to long term, differential rates of productivity growth among economic activities have a major impact on resource allocation and structural change in an economy.

This paper presents some results of a World Bank Research Project: Productivity Change in Infant Industry. We would like to thank Deborah Bateman for her research assistance and constructive discussions of the issues. The views and interpretations in this paper are those of the authors and should not be attributed to the World Bank, to its affiliated organisations or to any individual acting on their behalf.

The World Bank does not accept responsibility for the views expressed herein which are those of the authors and should not be attributed to the World Bank or to its affiliated organisations. The findings, interpretations, and conclusions are the results of research supported by the Bank; they do not necessarily represent official policy of the Bank. The designations employed, the presentation of material, and any maps used in this document are solely for the convenience of the reader and do not imply the expression of any opinion whatsoever on the part of the World Bank or its affiliates concerning the legal status of any country, territory, city, area, or of its authorities, or concerning the delimitations of its boundaries, or national affiliation.