A Quality of Growth Index for Developing Countries: A Proposal

By Montfort Mlachila, Rene Tapsoba, Sampawende J Tapsoba

September 16, 2014

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Montfort Mlachila, Rene Tapsoba, and Sampawende J Tapsoba. A Quality of Growth Index for Developing Countries: A Proposal, (USA: International Monetary Fund, 2014) accessed November 23, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper proposes a new quality of growth index (QGI) for developing countries. The index encompasses both the intrinsic nature and social dimensions of growth, and is computed for over 90 countries for the period 1990-2011. The approach is premised on the fact that not all growth is created equal in terms of social outcomes, and that it does matter how one reaches from one level of income to another for various theoretical and empirical reasons. The paper finds that the quality of growth has been improving in the vast majority of developing countries over the past two decades, although the rate of convergence is relatively slow. At the same time, there are considerable cross-country variations across income levels and regions. Finally, emprirical investigations point to the fact that main factors of the quality of growth are political stability, public pro-poor spending, macroeconomic stability, financial development, institutional quality and external factors such as FDI.

Subject: Economic growth, Education, Health, Inclusive growth, Income inequality, National accounts, Personal income

Keywords: Africa, Benchmark QGI, Composite index, Correlation matrix, Final period, Growth fundamentals, Inclusive growth, Income inequality, Personal income, QGI dynamics, QGI performance, QGI process, QGI score, QGI value, Quality of growth, Social indicators, Standard deviation, Sub-Saharan Africa, WP

Publication Details

Pages:

33
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2014/172
Stock No:

WPIEA2014172
ISBN:

9781498379274
ISSN:

1018-5941

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