Resource information
Real GDP per capita and capital stock in
Cote d'Ivoire grew strongly from 1960 to 1979, but have
declined ever since, for twenty-five years. As a result, the
country has traveled a full circle from economic success to
failure in little more than a generation. What are the
long-term factors behind this dismal growth story? Are the
Ivorian development problems mostly of recent origin? Or
there are more fundamental, economic factors that explain
its long term performance? Four principal conclusions are as
follows: First, Cote d'Ivoire's long-term growth
performance is not fully explained by temporary factors
(e.g., CFA overvaluation or recent conflict). Longer term
factors such as capital accumulation, productivity, and
terms of trade are key to understanding the country's
performance as is the policy of specialization in a single
commodity--cocoa. Second, the long-term decline in per
capita output started well before the currency
overvaluation, and at a time of political stability, and is
related to a major, secular deterioration in terms of trade
that started after 1976. Third, total factor productivity
estimates indicate that TFP per capita also grew until it
hit a plateau in 1976-78, and then shrank thereafter,
despite gains in human capital accumulation. Fourth, Cote
d'Ivoire has pursued a policy of specialization in
cocoa beans but this bet on a single commodity has
ultimately failed. The strategy that brought prosperity
during the 1970s resulted in a growth failure when cocoa
prices began declining since 1976.
