Today’s post shows OECD estimates of potential growth, which have declined dramatically over the last two decades, driven by a decline in the contribution of the capital stock and labour efficiency to growth. These are in the same ballpark as estimates from the Conference Board (here and here), World Bank and earlier OECD estimates. As we have argued previously, South Africa’s capital stock has been depleting for decades, and there has been a disconnect between employment (and developments in the labour market) and economic growth, for a variety of structural and policy reasons (see here for more).
