Stuck in the Middle? Structural Change and Productivity Growth in Botswana

Working Paper No. 21029 This paper decomposes Botswana's growth from the late 1960s through 2010 into a within-sector and a between-sector (structural change) component. We find that during the 70s and 80s Botswana's rapid economic growth was characterized by significant structural change...

Full description

Saved in:
Bibliographic Details
Published inNBER Working Paper Series p. 21029
Main Authors McCaig, Brian, McMillan, Margaret S, Verduzco-Gallo, Iñigo, Jefferis, Keith
Format Paper
LanguageEnglish
Published Cambridge National Bureau of Economic Research, Inc 01.03.2015
Subjects
Analysis
Developing countries
Economic growth
Economic theory
Employment
Fiscal policy
GDP
Government
Gross Domestic Product
Income inequality
Labor productivity
LDCs
Poverty
Studies
Trade liberalization
Value added
Botswana
Online AccessGet full text

Cover

More Information
Summary:Working Paper No. 21029 This paper decomposes Botswana's growth from the late 1960s through 2010 into a within-sector and a between-sector (structural change) component. We find that during the 70s and 80s Botswana's rapid economic growth was characterized by significant structural change with the share of the labor force employed in agriculture dropping from more than 80 percent to around 40 percent. Between 1990 and 2010 growth was also rapid, but structural change detracted from growth. We hypothesize that this is one of the reasons for persistent poverty and very high income inequality in Botswana today. This leaves us with the following puzzle: why is it that a country with such an impressive track record marked by good governance and prudent macroeconomic and fiscal policy is having so much trouble diversifying its economy?
ISSN:0898-2937
DOI:10.3386/w21029