From Farms to Factories and Firms : Structural Transformation and Labor Productivity Growth in Malaysia
This study aims to provide a quantitative and integrated analysis of long-term structural transformation and labor productivity growth in Malaysia. Using data from the Department of Statistics Malaysia from 1987 to 2018 and decompositions that take...
| 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/498221604428665083/From-Farms-to-Factories-and-Firms-Structural-Transformation-and-Labor-Productivity-Growth-in-Malaysia http://hdl.handle.net/10986/34730 |
| Summary: | This study aims to provide a
quantitative and integrated analysis of long-term structural
transformation and labor productivity growth in Malaysia.
Using data from the Department of Statistics Malaysia from
1987 to 2018 and decompositions that take account of the
static and dynamic efficiency gains from labor reallocation,
it documents that Malaysia has undergone structural
transformation from an agriculture-driven to a
services-driven economy. However, in contrast to common
perceptions, the country's impressive growth in output
per capita over the past three decades can largely be
attributed not to its structural transformation but instead
to sustained growth in within-sector labor productivity. At
3 percent, the contribution of between-sector reallocation
of labor to growth in output per capita in Malaysia has been
relatively low. Accordingly, together with efforts to spur
the more productive reallocation of labor across sectors and
positively affect the employment rate, the main policy
challenge for Malaysia going forward will be to achieve
sustainable labor productivity growth within various sectors. |
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