Reference no: EM133203813

Assignment:

Q1. In Globalization, structural change, and productivity growth, with an update on Africa'', McMillan et al (2014) show that we can decompose the change in aggregate labor productivity observed over a period into two components:

(i) a component due to changes in productivity within sectors, for a given distribution of labor across sectors (the within component);

(ii) a component due to changes in the shares of the different sectors in total employment, for given levels of labor productivity within sectors (the structural change component).

In particular, an economy will benefit from the structural change component if, all else equal, it succeeds in increasing the share of high-productivity sectors in total employment at the expense of low-productivity sectors.

Q2. Consider the authors' decomposition of productivity growth during the 1990-2005 period, in section 3(c). Consider the unweighted country averages across regions.

What do their findings suggest regarding the evolution of the shares of high-productivity sectors in total employment in Africa and Latin America during that period? How can you tell?

Q3. Consider the author's analysis of structural change in Thailand during the 1990-2005 period in section 3(d) (see, esp., pp. 23-24 and figure 16).

What do the data show regarding the change in the shares of Agriculture and Manufacturing in total employment?

Q4. Given the initial differences in labor productivity between Agriculture and every other sector in the economy in Thailand in the period, what is the implication of the observed pattern of structural change for aggregate productivity growth? (i.e. state whether the observed reallocation of labor contributed to increasing or decreasing aggregate labor productivity, and why.)

Q6. Consider Ocampo et al's (2009) classification of merchandise exports according to their technological and natural resource content --- namely, primary products, resource-based manufactures, low-technology manufactures, mediumtechnology manufactures, and high-technology manufactures.

Consider, in particular, their description of the evolution of the shares of these categories in total merchandise exports across different country groups, in pp. 59-62.

What differentiates the groups that displayed fast growth --- specifically, the East Asian tigers, Southeast Asia, and China ---from from the regions that displayed relative stagnation --- e.g.

Africa and Andean Countries. Be sure to examine: (i) the initial structure of exports, and (ii) the change in the structure of exports over the period under analysis.

Q7. Now consider Amsden's (2001) interpretation of the experiences of a set of developing countries that managed to expand exports of industrial goods (see, esp., pp. 171-173). What is the author's position regarding the relationship between having prior experience in the production of industrial goods for domestic markets and subsequent success in expanding industrial exports? Specifically, what is the role of `learning by doing' in explaining this relationship?

Q8. In light of your answer to part (2), briefly explain the rationale behind the 'infant industry protection' argument --- i.e. the notion that temporary protection of given industries from import competition may eventually allow an economy to develop the ability to export the output of these industries?

Readings:

1. Open economies and pattern of trade

By Mariangel  parra

2.Globalization, Structural Change, and Productivity Growth, with an Update on Africa

By MARGARET MCMILLAN