Labor Productivity and Economic Growth in a Hydrocarbon-Dependent Economy: The Algerian Case, 1984–2015

Serge Rey and Sofiane Hazem
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Sofiane Hazem: CATT, University of Pau et Pays de l’Adour, E2S UPPA

The European Journal of Development Research, 2020, vol. 32, issue 3, No 7, 587-611

Abstract: Abstract This paper addresses the empirical question of whether productivity can help explain the economic growth dynamics in Algeria over the period from 1984 to 2015. The first aim of this article is to measure the productivity for both the economy as a whole and for different sectors. Then, original estimates of the capital stock are made using the permanent inventory method, which enables the evolutions of the total factor productivity to be inferred. On the basis of these estimates, it is shown that, while the Algerian economy as a whole performed fairly well in terms of economic growth, this was more the result of an increase in production factors, i.e., labor force, than of labor productivity growth, which was very limited. This partly reflects the weak performance of the hydrocarbons sector, which has experienced a decline in labor productivity since the early 2000s, while other sectors such as agriculture have experienced strong productivity gains.

Keywords: Growth rate; Algeria; Hydrocarbons; Labor productivity; TFP (search for similar items in EconPapers)
JEL-codes: D24 O14 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1057/s41287-019-00229-z

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