Contribution of Knowledge to Economic Growth: the Case of Vietnam

r4d Working Paper 2015/7 by Nguyen Tu Anh and Nguyen Thu Thuy

ABSTRACT: This paper provides evidence for the contribution of various factors to the economic growth of Vietnam during the renovation process. Quantitative analysis shows that Vietnam’s economic growth depends on investment, but the efficiency of investment tends to get worse. Especially the contribution of knowledge, proxied by TFP (Total Factory Productivity), is proved to be negligible. The results give warnings on the possible slow-down of the country’s economic growth if no action is taken.