Wednesday, October 29, 2003

Boom Times in Turkey

Edward Hugh has an intriguing post up about an acceleration in productivity growth in Turkey; the figures quotes seem nothing short of phenomenal, and, I have to say, entirely unexpected, with the total factor productivity numbers being particularly encouraging. What has changed in the Turkish economy that has enabled such sterling performance, I wonder?

There is a discernible improvement in Turkey’s rate of productivity growth the single most important indicator of any nation’s economic performance. Output per worker has increased by 25.8% after the 2001 crisis, and total factor productivity, which reflects increases in productivity due to technological improvements, accelerated from an average of 0.5% in the 1990s to 4.7% in the last two years. In our view, the growth of labour productivity, which surged from less than 4% a year over the previous decade to an annual rate of 8.5%, is a case in point that the Turkish economy is gradually entering a new era with a higher potential growth rate.
Source: Serhan Cevik, MS Global Economic Forum