PRODUCTIVITY TRENDS IN PAKISTAN’S MANUFACTURING: 1955-81

We have computed a total factor productivity index for Pakistan’s large-scale manufacturing sector for the period 1955-81. The impact of the violation emanting from the use of growth accounting techniques has been minimized by treating our index as a residual and using marginal product weights. We have computed another total factor productivity index based on factor share weights in order to show the extent of the bias that emerges from using methodologies that
assume conditions which do not prevail in a developing economy like Pakistan.