The structure of growth in the South African economy: Factor accumulation and total factor productivity growth 1970-97

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In the present paper the concern is to provide one building block toward a better understanding of the South African growth performance. The purpose is to undertake a decomposition of output growth into the contributions to growth provided by factor (capital and labour) inputs, thereby isolating the contribution of growth in total factor productivity. The decompositions are undertaken for the 1970-97 period, on a decade by decade basis. Moreover, the decomposition is undertaken not only on an aggregate level, but on a sector-by-sector basis, particularly for the manufacturing sectors of South Africa. Finally, the contribution of total factor productivity is weighted by the real output contribution of sectors, to arrive at an intimation of the real cost reduction implied for the economy. An important result of the decompositions is an improved understanding of the underlying pattern of output growth for the South African economy across its constituent sectors. At the same time we wish to be clear that this paper is intended as a first contribution toward the development of a debate on growth accounting for the South African economy. While some sectoral studies on the structure of growth in South Africa exist, attempts at developing a more comprehensive sectoral understanding of growth in the economy have been more muted. This paper does not pretend to solve all the methodological and data concerns that arise with respect to growth accounting. But it does undertake to provide a reference point for further work on the subject.

Original languageEnglish (US)
Pages (from-to)282-299
Number of pages18
JournalSouth African Journal of Economics
Issue number4
StatePublished - Mar 2002

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics


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