Subdued Potential Growth : Sources and Remedies
Global potential output growth has been flagging. At 2.5 percent in 2013-17, post-crisis potential growth is 0.5 percentage point below its longer-term average and 0.9 percentage point below its average a decade ago. Compared with a decade ago, pot...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/976181583843503040/Subdued-Potential-Growth-Sources-and-Remedies http://hdl.handle.net/10986/33426 |
| Summary: | Global potential output growth has been
flagging. At 2.5 percent in 2013-17, post-crisis potential
growth is 0.5 percentage point below its longer-term average
and 0.9 percentage point below its average a decade ago.
Compared with a decade ago, potential growth has declined
0.8 percentage point in advanced economies and 1.1
percentage point in emerging market and developing
economies. The slowdown mainly reflected weaker capital
accumulation but is also evidence of decelerating
productivity growth and demographic trends that dampen labor
supply growth. Unless countered, these forces are expected
to continue and to depress global potential growth further
by 0.2 percentage point over the next decade. A menu of
policy options is available to help reverse this trend,
including comprehensive policy initiatives to lift physical
and human capital and to encourage labor force participation
by women and older workers. |
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