State-Business relations (SBRs) are reflected in business and investment climate indicators and may take the form of formal, regular, and informal interactions. The creation of an institutional environment in which the state provides high-quality public goods, such as infrastructure, political stability, elimination of corruption, and effective public administration, is important because it can improve productivity and lead to higher rates of growth. Resource reallocation from low to high productivity firms can generate large aggregate productivity gains with further potential benefits to economic growth. This study examines the relationship between productivity and resource misallocation in a sample of countries in the Middle East and North Africa (MENA) region, and Turkey. The analysis relies on data from the World Bank Enterprise Surveys over 2008-2016 of firms in Egypt, Turkey, and Yemen. In the analysis, we control various firm characteristics. Furthermore, we explore major state-business relations (SBRs) and their association to resource misallocation. The results are mixed, wherein in Egypt and Turkey, female ownership and international quality certification are positively associated with productivity and allocation efficiency. Moreover, obstacles in SBRs present a negative and significant correlation with the firms' performance and productivity, increasing dispersions in the resource allocation, output, and capital. We find that corruption, political instability, electricity supply, and high tax rates are the most critical obstacles in SBRs.

Considering population projections, which are estimated to be 10 billion people in the world by 2050, agricultural demand is expected to rise by about 50% compared to 2013 levels, even under a moderate economic development scenario. The number of people will increase in cities, and higher income levels per person will all have a significant impact on future food demand. There is only one way to raise food production without further depletion of natural resources, and that is to boost Total Factor Productivity (TFP). This study uses panel data analysis to investigate the factors that affect agricultural TFP in both developed and developing countries. Data is taken from the USDA/ERS (the