MENAFN published an op-ed by Dani Brodrik on how recent patterns of technological change in the rich world have made it more difficult for low-income countries to develop and converge with income levels in the developed world. These changes have contributed to deepening economic and technological dualism even within the more advanced segments of developing countries’ economies. In new research, senior research fellows Margaret McMillan (also affiliated with Tufts University) Xinshen Diao, and research analyst, Mia Ellis and Brodrik found a striking dichotomy in the performance of large versus smaller firms. In both Ethiopia and Tanzania, larger firms exhibit superior productivity performance but do not expand employment much, while small firms absorb labor but do not experience much productivity growth. The result is that these economies create few good jobs, while the benefits of productivity enhancements remain limited to a very small segment of manufacturing. (Originally published in Project Syndicate).
