Productivity Growth and Efficiency Dynamics of Korean Structural Transformation

Jeong, Hyeok

World Bank, Washington, DC

关键词: PRODUCTIVITY GROWTH;    STRUCTURAL TRANSFORMATION;    TOTAL FACTOR PRODUCTIVITY;    SUSTAINABLE DEVELOPMENT;    MARGINAL RATE OF SUBSTITUTION;   

DOI  :  10.1596/1813-9450-9285
RP-ID  :  WPS9285

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper documents the sources of theRepublic of Korea's economic growth, as well as theassociated productivity growth and efficiency dynamicsduring its process of structural transformation from 1970 to2016. The analysis includes land as a separate productionfactor to sort out the significant effect of changes inintersectoral land allocation, which makes significantdifferences in measuring the magnitudes and directions ofchange in sectoral total factor productivity (TFP).Input-based growth and structural changes contributed to theearly take-off stage of growth in the 1970s. However, in thefollowing three decades, the source of growth switched toproductivity improvements, mainly engineered by the industrysector. This was the reason behind the country'ssustained growth and escape from the "middle-incometrap." Furthermore, agricultural TFP growth also madean important contribution to structural transformation bypushing out factors from agriculture to industry. Since2011, however, when the Korean economy seemed to reach asteady state of constant capital-output ratio, TFP hassuddenly stagnated. The wedge analysis suggests that theintersectoral allocation of labor was biased towardagriculture while that of capital and land was biased towardindustry, compared to efficient levels. Meanwhile, theinter-temporal wedge analysis suggests that the Koreaneconomy was in an over-investment mode throughout itsstructural transformation. The analysis also shows that theperiods of productivity growth are not always associatedwith the enhancement of allocative efficiency, whilegrowth-disturbing external macroeconomic shocks, such asjoining the WTO and the Asian financial crisis, led toimprovements in allocative efficiency.