economic environment. As unrealistic as some of these assumptions might be, economic growth accounting is used as a methodological tool kit to study the relation of economic growth in real life to changes in its major supply sources.
The paper analyses the impact of labour on real GDP growth rates in Bulgaria using the above specified set of tools. It begins by examining the relationship between long- and short-term dynamics of the two variables over the whole post-1990 period. Next, four alternative assessments are made of labour’s relative share in income which, under the assumption of production factor pricing based on the marginal productivity of these factors, is considered as a labour elasticity coefficient in the two- factor production function. In the last stage, based on the outcomes for the elasticity coefficient and labour growth data, the
Impact of Labour on Economic Growth in Bulgaria (1991 – 2013)
contribution of this factor to the realised rates of economic growth is assessed and characterised.
The paper measures labour input through employment which is a standard practice in most contemporary empirical studies with a focus on the behaviour of actual rather than potential GDP. Employment itself is measured in two ways: by means of Labour Force Survey (LFS) data for the whole post-1990 period relating to the number of employed, and by drawing from the national accounts (NA) data for the period after 1995 related to the number of man hours worked.
economic environment. As unrealistic as some of these assumptions might be, economic growth accounting is used as a methodological tool kit to study the relation of economic growth in real life to changes in its major supply sources.The paper analyses the impact of labour on real GDP growth rates in Bulgaria using the above specified set of tools. It begins by examining the relationship between long- and short-term dynamics of the two variables over the whole post-1990 period. Next, four alternative assessments are made of labour’s relative share in income which, under the assumption of production factor pricing based on the marginal productivity of these factors, is considered as a labour elasticity coefficient in the two- factor production function. In the last stage, based on the outcomes for the elasticity coefficient and labour growth data, theImpact of Labour on Economic Growth in Bulgaria (1991 – 2013)contribution of this factor to the realised rates of economic growth is assessed and characterised.The paper measures labour input through employment which is a standard practice in most contemporary empirical studies with a focus on the behaviour of actual rather than potential GDP. Employment itself is measured in two ways: by means of Labour Force Survey (LFS) data for the whole post-1990 period relating to the number of employed, and by drawing from the national accounts (NA) data for the period after 1995 related to the number of man hours worked.
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