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Mauritius: The Drivers of Growth – Can the Past Be Extended?

Author

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  • Katsiaryna Svirydzenka

    (International Monetary Fund, United States)

  • Martin Petri

    (International Monetary Fund, United States)

Abstract
Mauritius’s economic performance since its independence has been called “the Mauritian miracle” and the “success of Africa” (Romer, 1992; Frankel, 2010; Stiglitz, 2011). However, the future growth potential is more uncertain. In this paper, we use growth accounting to analyze the sources of past growth and project potential ranges of future growth through 2033 under various policies. Growth averaged 41 percent over the past 20 years. Our baseline suggests future growth rates around 31 percent, but growth could reach 4–5 percent with strong pro-active policies including (i) improving investment and savings rates; (ii) improving the efficiency of social spending and public enterprise reforms; (iii) investment in education and education reforms; (iii) labor market reforms; and (iv) further measures to reduce bottlenecks and increase productivity. With policies capable of generating 5 percent growth, Mauritius could reach high-income status in 2021, 4 years earlier than under the baseline.

Suggested Citation

  • Katsiaryna Svirydzenka & Martin Petri, 2017. "Mauritius: The Drivers of Growth – Can the Past Be Extended?," Journal of Banking and Financial Economics, University of Warsaw, Faculty of Management, vol. 2(8), pages 54-83, October.
  • Handle: RePEc:sgm:jbfeuw:v:2:y:2017:i:8:p:54-83
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    Cited by:

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    2. Romina Kazandjian & Ms. Lisa L Kolovich & Ms. Kalpana Kochhar & Ms. Monique Newiak, 2016. "Gender Equality and Economic Diversification," IMF Working Papers 2016/140, International Monetary Fund.
    3. Rukmani Gounder, 2022. "Tourism-led and economic-driven nexus in Mauritius: Spillovers and inclusive development policies in the case of an African nation," Tourism Economics, , vol. 28(4), pages 1040-1058, June.
    4. Usha Devi Chuttoo, 2020. "Effect of Economic Growth on Unemployment and Validity of Okun’s Law in Mauritius," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 12(2), pages 231-250, May.
    5. Ping Wang & Tsz-Nga Wong & Chong K. Yip, 2018. "Institutional Barriers and World Income Disparities," Review, Federal Reserve Bank of St. Louis, vol. 100(3), pages 259-279.
    6. Roshini Brizmohun & Diana Alessandrini & Valentina Hartarska, 2021. "Gender wage gap in small islands: Effect of a policy framework in Mauritius," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 2207-2229, November.
    7. Romina Kazandjian & Lisa Kolovich & Kalpana Kochhar & Monique Newiak, 2019. "Gender Equality and Economic Diversification," Social Sciences, MDPI, vol. 8(4), pages 1-24, April.

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    More about this item

    Keywords

    Growth; Mauritius; Growth accounting;
    All these keywords.

    JEL classification:

    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O5 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies

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