Commodity dependence, productivity and structural change

The connections between commodity dependence, labour productivity trends and structural change in commodity dependent developing countries are analysed in this chapter. Improvements in labour productivity are a key source of economic growth and thus closely linked to the overall development process in low-income and middle-income countries. In particular, labour productivity growth can be a long-term driver of increased real wages and improved living standards in developing countries. The importance of labour productivity growth in the development process is reflected in the inclusion of a related indicator under Millennium Development Goal 1 on eradicating extreme poverty and hunger and in its inclusion in the Sustainable Development Goals framework: target 8.2 aims to “achieve higher levels of economic productivity through diversification, technological upgrading and innovation, including through a focus on high value added and labour-intensive sectors” and indicator 8.2.1 is the annual growth rate of real GDP per employed person, as noted in resolution 71/313 of the General Assembly. Diversification and technological development play crucial roles in labour productivity growth.

Sustainable Development Goals:

No Poverty

Decent Work and Economic Growth

Industry, Innovation and Infrastructure