Services in Developing Economies: A new chance for catching-up?

Gisela Di Meglio, Jorge Gallego, Andrés Maroto and Maria Savona ()
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Andrés Maroto: Department of Economic Analysis Autonomous University of Madrid, Spain.

SPRU Working Paper Series from SPRU - Science Policy Research Unit, University of Sussex Business School

Abstract: The paper analyses the potential contribution of services as a driving force of economic growth in developing countries within a Kaldorian framework. In doing so, we revisit Kaldor Growth Laws and econometrically test them for a number of economic activities (including four service branches) across twenty-nine developing countries from Asia, Latin-America and Sub-Saharan Africa during a time span of three decades (1975-2005). Panel data estimations are complemented with a decomposition of labour productivity growth by means of a shift-share analysis. The results induce to question the traditional role posed to services as unlikely drivers of productivity growth in developing economies. As a matter of fact, business services seem to allow productivity growth by the same Kaldorian mechanisms that have traditionally made manufacturing the key driver of growth.

Keywords: structural change; growth; development; productivity; Kaldor (search for similar items in EconPapers)
JEL-codes: C23 L16 O14 O47 (search for similar items in EconPapers)
Date: 2015-11
New Economics Papers: this item is included in nep-dev, nep-eff, nep-pke and nep-sea
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Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:sru:ssewps:2015-32

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