TFP in Tunisian Manufacturing Sectors : Convergence or Catch-Up with OECD Members?

Total Factor Productivity (TFP) is analyzed for six Tunisian manufacturing sectors: food processing, electrical and metal products, chemical activities, textiles, clothing and leather, building materials and ceramics, miscellaneous products. First, sector-based TFP are calculated over a long period (1983–2002) as well as some sub-periods reflecting changes of local economic policy. Then, using an accounting framework, we decompose the industrial productivity into a reallocation effect (i.e., variation in the relative distribution of sectoral value added), and a pure productivity effect (i.e., the sectoral value-added shares being constant). Secondly, through panel data unit root tests, TFP long-term convergence with or without catch-up is examined with respect to the productive performance of OECD members. Each of the six Tunisian manufacturing sectors is benchmarked by the productive performance of OECD members. The Dickey-Fuller type test that we use allows us to take into account the potential correlation across OECD countries. The empirical analysis highlights two main findings. TFP convergence and catch-up have generally been a joint process. Moreover, the sectors where catch-up occurred were those with the best productive performance and those that succeeded in reducing the productivity gap with regard to the best OECD performers