Estimating Poland's Potential Output: A Production Function Approach

This paper focuses on EU structural and cohesion funds assistance to Bulgaria during the 2007-13 program period. Initial weaknesses resulted in a low absorption rate, which was mitigated by increasing advance payments; applying electronic application and reporting procedures; simplifying and unifying tender processes; and strengthening the role of international financial institutions and banks in project preparation, evaluation and monitoring. The possible impact on growth and potential output is briefly discussed, while the risks of improper absorption are acknowledged. Valuable lessons have been learned, but it is recommended that additional steps be taken for the next program period 2014-20.

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confidence: 99%

Bulgaria’s EU Funds Absorption: Maximizing the Potential!

Paliova

Lybek²

2014

“…Because capital input is not available, it is generated using the usual perpetual inventory model (Epstein andMacchiarelli, 2010, Teixeira de Silva, 2001) as in:…”

Section: The Production Function Approachmentioning

confidence: 99%

Potential Output and Output Gap in Central America, Panama and Dominican Republic

Johnson

2013

Potential Output is a key factor for debt sustaintability analysis and for developing strategies for growth, but unfortunately it is an unobservable variable. Using three methodologies (production function, switching, and state-space), this paper computes potential output for CAPDR countries using annual data. Main findings are: i) CAPDR potential growth is about 4.4 percent while output gap volatility is about 1.9 percent; ii) The highest-potential growth country is Panama (6.5 percent) while the lowest-growth country is El Salvador (2.6 percent); iii) CAPDR business cycle is about eigth years.

“…For developing economies, a simplified and reduced form of the method may instead be implemented. For example,Epstein and Macchiarelli (2010), using the case of Poland, focus on identifying the trend labor input in the production function (i.e. the natural rate of employment).©International Monetary Fund.…”

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confidence: 99%

Modeling with Limited Data: Estimating Potential Growth in Cambodia

Rungcharoenkitkul

2012

This paper proposes a framework to analyze long-term potential growth that combines a simple quantitative model with an investigative approach of 'growth diagnostics'. The framework is used to forecast potential growth for Cambodia, and to conduct simulations about the main drivers of growth in that country. The main result is that Cambodia compares less favorably against other lower-income Asian economies in terms of its investment rate, which in turn is constrained by the poor quality of its infrastructure. Bridging this gap can lift Cambodia's potential growth by more than one percentage point.