NATIONAL BUREAU OF ECONOMIC RESEARCH
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The Changing Structure of Africa's Economies

Xinshen Diao, Kenneth Harttgen, Margaret McMillan

NBER Working Paper No. 23021
Issued in January 2017
NBER Program(s):Development Economics, International Trade and Investment, Productivity, Innovation, and Entrepreneurship

Using data from the Groningen Growth and Development Center’s Africa Sector Database and the Demographic and Health Surveys, we show that much of Africa’s recent growth and poverty reduction has been associated with a substantive decline in the share of the labor force engaged in agriculture. This decline is most pronounced for rural females over the age of 25 who have a primary education; it has been accompanied by a systematic increase in the productivity of the labor force, as it has moved from low productivity agriculture to higher productivity services and manufacturing. We also show that although the employment share in manufacturing is not expanding rapidly, in most of the low-income African countries, the employment share in manufacturing has not peaked and is still expanding, albeit from very low levels. More work is needed to understand the implications of these shifts in employment shares for future growth and development in Africa south of the Sahara.

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Document Object Identifier (DOI): 10.3386/w23021

Published: Xinshen Diao & Kenneth Harttgen & Margaret McMillan, 2017. "The Changing Structure of Africa’s Economies," The World Bank Economic Review, vol 31(2), pages 412-433. citation courtesy of

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