Modeling with Limited Data: Estimating Potential Growth in Cambodia
April 1, 2012
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Summary
This paper proposes a framework to analyze long-term potential growth that combines a simple quantitative model with an investigative approach of ‘growth diagnostics’. The framework is used to forecast potential growth for Cambodia, and to conduct simulations about the main drivers of growth in that country. The main result is that Cambodia compares less favorably against other lower-income Asian economies in terms of its investment rate, which in turn is constrained by the poor quality of its infrastructure. Bridging this gap can lift Cambodia’s potential growth by more than one percentage point.
Subject: Labor, Output gap, Potential output, Production, Productivity, Total factor productivity
Keywords: aggregate production function, Cambodia, export diversification, Global, growth diagnostics, investment rate, math, Output gap, Phillips curve, Potential output, Productivity, productivity gain, productivity improvement, productivity level, productivity term, saving rate, Total factor productivity, WP
Pages:
18
Volume:
2012
DOI:
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Issue:
096
Series:
Working Paper No. 2012/096
Stock No:
WPIEA2012096
ISBN:
9781475502862
ISSN:
1018-5941
