What do we know about productivity in Arab economies: The challenges of generating multifactor productivity (MFP) estimates at industry level

The Arab world has witnessed major economic, political and social changes since the onset of the Arab spring in 2011. Despite the rapidly spreading and worsening political turmoil, as well as, in many cases, an unstable internal socio-political environment, many of the Arab countries in transition, which include Egypt, Jordan, Libya, Morocco, Tunisia and Yemen, have more or less maintained macroeconomic stability (IMF 2014). However, these countries have not been able to generate the kind growth rates required for a meaningful reduction in poverty and creation of jobs. Notwithstanding diversity of conditions, there is need to advance structural reforms to foster higher and more inclusive growth. It is well known that Arab countries do not rank very high in terms of global competitiveness.1 Further, in some of the Arab countries, there has been uneven implementation of structural reforms carried out in the mid-1980s. The important question to pose is - has growth delivered following such reforms in the Arab world?.