IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/62920.html
   My bibliography  Save this paper

Multidimensional structural transformation index: a new measure of development

Author

Listed:
  • Kelbore, Zerihun Getachew

Abstract

Achieving structural transformation is believed to be a priority agenda in development policy of developing countries. However, the discussion of structural transformation has been bound to an analysis of labor shifts and productivity convergence between economic sectors. This narrow definition of structural transformation neglects the vital aspect of structural transformation: social transformation. This study tries to fill this gap by proposing a multidimensional structural transformation index (STI). The proposed index measures structural transformation in two phases based on economic and socio-demographic indicators. This multidimensional indicator may contribute to the development literature as it can be used to measure the extent of structural transformation across economies and overtime. The investigation of the relationships of the STIs with the GDP per capita revealed that the STI based on economic and social dimensions appears to have greater effect on GDP per capita than STI focusing on economic indicators. The implication of this is that structural transformation containing social transformation as its priority is essential to achieve inclusive growth, sustain structural transformation, significantly reduce poverty, and hence enhance economic development. Each of the STI is a single number lying between 0 and 1, where 0 indicates lack of structural transformation and 1 complete transformation. The index is mathematically consistent, easy to compute, and comparable across countries overtime.

Suggested Citation

  • Kelbore, Zerihun Getachew, 2014. "Multidimensional structural transformation index: a new measure of development," MPRA Paper 62920, University Library of Munich, Germany, revised 16 Mar 2015.
    • Handle: RePEc:pra:mprapa:62920
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/62920/1/MPRA_paper_62920.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mandira Sarma, "undated". "Index of Financial Inclusion," Indian Council for Research on International Economic Relations, New Delhi Working Papers 215, Indian Council for Research on International Economic Relations, New Delhi, India.
    2. Andrea Saltelli, 2007. "Composite Indicators between Analysis and Advocacy," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 81(1), pages 65-77, March.
    3. repec:bla:obuest:v:61:y:1999:i:0:p:631-52 is not listed on IDEAS
    4. Choi, In, 2001. "Unit root tests for panel data," Journal of International Money and Finance, Elsevier, vol. 20(2), pages 249-272, April.
    5. Peter Timmer & Selvin Akkus, 2008. "The Structural Transformation as a Pathway out of Poverty: Analytics, Empirics and Politics," Working Papers 150, Center for Global Development.
    6. Mandira Sarma, 2012. "Index of Financial Inclusion – A measure of financial sector inclusiveness," Competence Centre on Money, Trade, Finance and Development 1207, Hochschule fuer Technik und Wirtschaft, Berlin.
    7. G. S. Maddala & Shaowen Wu, 1999. "A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(S1), pages 631-652, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. José Abraham López Machuca & Jorge Eduardo Mendoza Cota, 2017. "Salarios, desempleo y productividad laboral en la industria manufacturera mexicana. (Wage, Unemployment and Labor Productivity in the Mexican Manufacturing Industry)," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(2), pages 185-228, October.
    2. Lauren Stagnol, 2015. "Designing a corporate bond index on solvency criteria," EconomiX Working Papers 2015-39, University of Paris Nanterre, EconomiX.
    3. Tang, Kin-Boon, 2011. "The precise form of uncovered interest parity: A heterogeneous panel application in ASEAN-5 countries," Economic Modelling, Elsevier, vol. 28(1-2), pages 568-573, January.
    4. László KÓNYA, 2023. "Per Capita Income Convergence and Divergence of Selected OECD Countries to and from the US: A Reappraisal for the period 1900-2018," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 23(1), pages 33-56.
    5. Patrizia Ordine & Giuseppe Rose, 2008. "Local Banks Efficiency and Employment," LABOUR, CEIS, vol. 22(3), pages 469-493, September.
    6. Ronald MacDonald & Flávio Vieira, "undated". "A panel data investigation of real exchange rate misalignment and growth," Working Papers 2010_13, Business School - Economics, University of Glasgow.
    7. Cosmin Enache & Ciprian Pânzaru, 2012. "Romanian Migration Flows In European Countries: Does Social Security Matter?," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 2(14), pages 1-17.
    8. Chukwuebuka Bernard Azolibe, 2021. "Determinants of External Indebtedness in Heavily Indebted Poor Countries: What Macroeconomic and Socio-Economic Factors Matter?," The American Economist, Sage Publications, vol. 66(2), pages 249-264, October.
    9. Cristina Brasili & Luciano Gutierrez, 2004. "Regional convergence across European Union," Development and Comp Systems 0402002, University Library of Munich, Germany.
    10. Md. Mizanur Rahman & Tahsin Binta Anis, 2023. "Government expenditure on education and economic growth: a panel data analysis," Journal of Community Positive Practices, Catalactica NGO, issue 2, pages 30-46.
    11. In Choi, 2019. "Unit Root Tests for Dependent Micropanels," The Japanese Economic Review, Springer, vol. 70(2), pages 145-167, June.
    12. Nagmi Moftah Aimer, 2020. "Renewable energy consumption, financial development and economic growth: Evidence from panel data for the Middle East and North African countries," Economics Bulletin, AccessEcon, vol. 40(3), pages 2058-2072.
    13. Cem Ertur & Antonio Musolesi, 2017. "Weak and Strong Cross‐Sectional Dependence: A Panel Data Analysis of International Technology Diffusion," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 32(3), pages 477-503, April.
    14. Yongsheng Jiang & Dong Zhao & Andrew Sanderford & Jing Du, 2018. "Effects of Bank Lending on Urban Housing Prices for Sustainable Development: A Panel Analysis of Chinese Cities," Sustainability, MDPI, vol. 10(3), pages 1-16, February.
    15. Hamit-Haggar, Mahamat, 2012. "Greenhouse gas emissions, energy consumption and economic growth: A panel cointegration analysis from Canadian industrial sector perspective," Energy Economics, Elsevier, vol. 34(1), pages 358-364.
    16. Ayhan KULOĞLU & Eyyup ECEVİT, 2017. "The Relationship Between Health Development Index And Financial Development Index: Evidence From High Income Countries," Journal of Research in Economics, Politics & Finance, Ersan ERSOY, vol. 2(2), pages 83-95.
    17. Selien De Schryder & Gert Peersman, 2016. "The U.S. Dollar Exchange Rate and the Demand for Oil," The Energy Journal, , vol. 37(1), pages 90-114, January.
    18. Revoredo-Giha, Cesar & Leat, Philip M.K. & Renwick, Alan W., 2012. "The relationship between output and unemployment in Scotland: A regional analysis," Working Papers 131465, Scotland's Rural College (formerly Scottish Agricultural College), Land Economy & Environment Research Group.
    19. Kristofer Månsson & Ghazi Shukur & Pär Sjölander, 2013. "Testing for panel unit roots in the presence of spatial dependency," Applied Economics, Taylor & Francis Journals, vol. 45(29), pages 4152-4159, October.
    20. Hiroyuki Taguchi & Aktamov Asomiddin, 2022. "Energy-Use Inefficiency and Policy Governance in Central Asian Countries," Energies, MDPI, vol. 15(4), pages 1-15, February.

    More about this item

    Keywords

    Structural Transformation Index; Normalized Euclidean Distance; Inverse Euclidean Distance; Factor/Principal Components Analysis;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:62920. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.