NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Xinshen Diao

Development Strategy and
Governance Division
International Food Policy
Research Institute
2033 K Street NW
Washington, DC 20006

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NBER Working Papers and Publications

February 2017The Recent Growth Boom in Developing Economies: A Structural Change Perspective
with Margaret McMillan, Dani Rodrik: w23132
Growth has accelerated in a wide range of developing countries over the last couple of decades, resulting in an extraordinary period of convergence with the advanced economies. We analyze this experience from the lens of structural change – the reallocation of labor from low- to high-productivity sectors. Patterns of structural change differ greatly in the recent growth experience. In contrast to the East Asian experience, none of the recent growth accelerations in Latin America, Africa, or South Asia was driven by rapid industrialization. Beyond that, we document that recent growth accelerations were based on either rapid within-sector labor productivity growth (Latin America) or growth-increasing structural change (Africa), but rarely both at the same time. The African experience is part...
January 2017The Changing Structure of Africa's Economies
with Kenneth Harttgen, Margaret McMillan: w23021
Using data from the Groningen Growth and Development Center’s Africa Sector Database and the Demographic and Health Surveys, we show that much of Africa’s recent growth and poverty reduction has been associated with a substantive decline in the share of the labor force engaged in agriculture. This decline is most pronounced for rural females over the age of 25 who have a primary education; it has been accompanied by a systematic increase in the productivity of the labor force, as it has moved from low productivity agriculture to higher productivity services and manufacturing. We also show that although the employment share in manufacturing is not expanding rapidly, in most of the low-income African countries, the employment share in manufacturing has not peaked and is still expanding, albe...

Published: Xinshen Diao & Kenneth Harttgen & Margaret McMillan, 2017. "The Changing Structure of Africa’s Economies," The World Bank Economic Review, vol 31(2), pages 412-433.

December 2016Economic Transformation in Africa from the Bottom Up: Evidence from Tanzania
with Josaphat Kweka, Margaret McMillan: w22889
At roughly 4% per annum, labor productivity in Tanzania has grown more rapidly over the past 12 years than at any other time in recent history. Employment growth has also been strong keeping up with population growth at roughly 2.5 percent per annum; the bulk of employment growth (90%) has been in the non-agricultural sector. However, the vast majority of this non-agricultural employment growth has occurred in the informal sector. Using Tanzania’s first nationally representative survey of micro, small and medium sized enterprises - we show that firms in the informal sector contributed roughly half a percentage point to economy-wide labor productivity growth in Tanzania between 2002 and 2012. However, virtually all of the labor productivity growth contributed by informal firms came from a s...
March 2015Toward an Understanding of Economic Growth in Africa: A Re-Interpretation of the Lewis Model
with Margaret McMillan: w21018
Africa’s recent economic growth is at a historical high. The patterns associated with this growth appear to be quite different from the Asian experiences where rapid growth was fueled by labor intensive, export-oriented manufacturing. Because this pattern differs with our typical view of structural transformation, a heated debate has begun over the sustainability of Africa’s growth. One thing is clear: the recent growth is not well understood. Against this background, we adapt Lewis’s (1954) dual-economy model to the economies of Africa to better understand the role that the “in-between” sector as defined by Lewis (1979) has played in Africa’s recent growth. Our framework incorporates the coexistence of a closed and an open modern economy and takes into account the diversity and heterogene...

Published: Xinshen Diao & Margaret McMillan, 2017. "Toward an Understanding of Economic Growth in Africa: A Reinterpretation of the Lewis Model," World Development, .

 
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