Productivity Growth and Structural Reform in Bulgaria: Restarting the Convergence Engine
IMF Working Papers, May 1, 2012
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- Productivity Growth and Structural Reform in Bulgaria: Restarting the Convergence Engine
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Bibliographic details
- Authors: Cyril Pouvelle, Pritha Mitra
- Published: May 1, 2012
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781475503678.001
Summary and central conclusion
- Labor productivity levels in Bulgaria lag well behind that in the EU, weighing on the convergence process.
- Stronger productivity growth would allow Bulgaria to close the income gap with the EU average more quickly and to alleviate structural problems in its labor market, reflected in its high long–term and youth unemployment.
- Analysis suggests that closing the gap with EU standards in the areas of institutional and infrastructure quality, goods market efficiency, higher education, and innovation would permanently boost productivity growth by a total of 1 percentage point a year.
- A permanent productivity boost of 1 percentage point a year would be enough to close the income gap with the EU average by 2040, compared to the status quo where it would take an additional 10 years.
Empirical findings and projections
- Current labor productivity in Bulgaria is substantially below EU averages (description as stated in the source).
- Estimated permanent productivity gain from closing EU gaps across targeted areas: 1 percentage point a year.
- Projected timeline with reforms: income gap with EU average closed by 2040.
- Projected timeline without these reforms (status quo): closure would take 10 additional years beyond 2040.
Policy-relevant drivers identified
- Institutional quality
- Infrastructure quality
- Goods market efficiency
- Higher education
- Innovation
(Improving these areas is presented as the path to delivering the aggregated 1 percentage point per year productivity improvement.)
Publication and metadata
- Authors: Cyril Pouvelle, Pritha Mitra
- Date: May 1, 2012
- Series: Working Paper No. 2012/131
- Issue: 131
- Volume: 2012
- Pages: 20
- DOI: https://doi.org/10.5089/9781475503678.001
- Stock No: WPIEA2012131
- ISBN: 9781475503678
- ISSN: 1018-5941
- Subjects: Income, Job creation, Labor, Labor productivity, National accounts, Production, Productivity, Unemployment
- Keywords: Bulgaria, convergence-low productivity nexus, Cross-Country Convergence, Economic Growth, Employment, Europe, GDP, Global, Income, income convergence, Job creation, Labor productivity, labor productivity growth, Productivity, productivity driver, productivity gain, productivity level, productivity-enhancing technology, Unemployment, Wages, WP
Source: IMF Working Paper “Productivity Growth and Structural Reform in Bulgaria: Restarting the Convergence Engine”, Cyril Pouvelle and Pritha Mitra, Working Paper No. 2012/131 (May 1, 2012), DOI: https://doi.org/10.5089/9781475503678.001