Caribbean Growth in an International Perspective: The Role of Tourism and Size

By Nita Thacker, Sebastian Acevedo Mejia, Roberto Perrelli

September 27, 2012

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Nita Thacker, Sebastian Acevedo Mejia, and Roberto Perrelli. Caribbean Growth in an International Perspective: The Role of Tourism and Size, (USA: International Monetary Fund, 2012) accessed September 24, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

After earlier success, growth performance in most Caribbean countries has been disappointing since the early 1990s. With slower growth, output has fallen behind that of relevant comparator countries. This paper analyzes the growth experience of the Caribbean countries from a cross country perspective. Three findings stand out. First, the slowdown in growth is explained more by a decline in productivity rather than a lack of investment. Second, tourism has been a significant contributor to higher growth (through both capital accumulation and productivity) and lower output volatility, and in many countries there is scope for further expansion of this sector. Third, the small size and the fact that most of these countries are islands have limited growth. Policies aimed at improving productivity, further development of the tourism sector, and regional integration could pay dividends in terms of higher growth in the region.

Subject: Economic sectors, Expenditure, Labor, Production, Production growth, Productivity, Public expenditure review, Total factor productivity, Tourism

Keywords: Capital accumulation, Caribbean, Economic growth, Government spending, Growth, Growth rate, Production growth, Productivity, Public expenditure review, Size, TFP component, TFP decline, TFP growth, TFP ratio, Total factor productivity, Tourism, WP

Publication Details

Pages:

35
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2012/235
Stock No:

WPIEA2012235
ISBN:

9781475510898
ISSN:

1018-5941

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