Article
Total Factor Productivity Growth:
Evidence from West African
Economies
Isaac Abekah-Koomson
1
Pang Wei Loon
1
Gamini Premaratne
1
Teo Siew Yean
1
Abstract
Since the 1990s, the economic growth of the West African region has been remarkable, with average
GDP growth of 5 per cent annually. In view of that, this article investigates the Total Factor Productivity
(TFP) performance for the Economic Community of West African States (ECOWAS) region, which
takes into account the recent development on political stability and trade openness. There were also
periods when TFP fell sharply, the most significant happened in the late 1990s and 2000s where TFP
dropped significantly which might be attributed to the spillover effect of the Asian and global financial
crises. Our results showed that TFP was performing well for the region as well as for each member
countries for the period of the study. We acknowledged that the estimated TFP in our model captures
other factors such as human capital, health and other institutional factors that could affect economic
growth. We also estimated the Technical Efficiency (TE) for the ECOWAS region using the Stochastic
Frontier Modelling and the result indicates that the TE performance is well below the optimal level of
production.
Keywords
Total factor productivity (TFP), output growth, trade policy, ECOWAS, technical efficiency, stochastic
frontier modelling
Introduction
The African region achieved a period of sustainable growth for the past two decades following the
process of slow economic growth before the turn of the millennium as characterized by a series of
Global Business Review
1–16
© 2019 IMI
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DOI: 10.1177/0972150919856194
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1
School of Business Economics (SBE), University of Brunei Darussalam (UBD), Muara District, Jalan Tungku Link Gadong, Brunei
Darussalam.
Corresponding author:
Gamini Premaratne, School of Business Economics (SBE), University of Brunei Darussalam (UBD), Muara District, Jalan Tungku Link
Gadong BE1410, Brunei Darussalam.
E-mail: gamini.premaratne@ubd.edu.bn