movement of resources to sectors operating at higher productivity levels (Rodrik, 2013b).<sup>6</sup> Industrialization-led structural change can solely fuel rapid growth, as applied in Asia.<sup>7</sup> By contrast, investments in fundamentals take time to bear fruit, tend to be costly, and mostly yield steady, albeit slow, growth, typical of the West. Structural change is thus purportedly an easier and a more viable way of achieving sustained rapid growth during early stages of development.<sup>8</sup> In a nutshell, the paper seeks to address the following main questions: What were the overriding trends underlying output, employment, and labor productivity in BBC? How do these trends compare with those of Asian economies (both when they were at BBC’s stages of economic development and during their respective growth spurts) and SSA comparators? What has been the pace and nature of structural change in BBC and what similarities and differences would stand out from comparisons with Asian and SSA benchmark countries? How much of productivity growth and overall economic growth in the three West African counties can be traced to structural change and within-sector productivity gains/losses? Has structural change been growth-enhancing (with labor moving from low- to highproductivity sectors) or growth-reducing? Has structural change been driven by static or dynamic reallocation effects? What are the relative contributions of demographic changes and employment rate to per capita growth?

We find that growth was driven by static structural change and modest within-sector productivity growth, despite heterogeneity across countries and over time. Specifically, growth in Benin during 2006-2015 was almost entirely due to static structural change, while a dynamic loss and negative “within” effect reduced growth. Between 1998 and 2014, Burkina Faso registered growth per capita of 3 percent, over 80 percent of which was due to structural change. The contribution of the static reallocation effect stood at 1.6 percent, roughly half of the growth per capita. In contrast, within-sector changes played a marginal role. Côte d’Ivoire’s meager growth in 2002-2014 was underpinned by a higher employment rate and, to a lesser extent, (static) structural change, while within-sector productivity exhibited a secular decline. In all three countries, demographic changes made a positive contribution to growth. Finally, we show that, unlike the case with fast-growing Asian economies, structural change in BBC has been characterized by the sheer absence of labor movements to highproductivity sectors. BBC, however, exhibit patterns more or less similar to their African counterparts.

The rest of the paper is organized as follows: Section 2 provides an overview of developments in the level, growth, and composition of output, employment, and labor productivity in BBC and benchmarks these trends against those of selected Asian and African economies. Section 3 discusses the decomposition method used in this paper. Section 4 thoroughly discusses the empirical results for BBC while putting them in perspective through comparisons with selected benchmark countries. Finally, Section 5 winds up the paper with some concluding remarks.

# **2. Output, Employment, and Productivity Trends: An Overview**

This section provides an overview of the trends underlying output, employment, and labor productivity in Benin, Burkina Faso, and Côte d’Ivoire since 2000. We seek to gain some insight into the nature and pace of structural change in these economies by examining the levels, growth, and composition of production, employment and labor productivity. Annual data on value added by sectors were obtained from the respective countries’ national accounts data set. The gross and sectoral value added (GVA) data generally span the period since the mid-1990s. However, the analysis uses a slightly truncated sample period due to the paucity of data on sectoral employment.

> 6It should be borne in mind, however, that both processes are not mutually exclusive and reinforce each other.

> 7However, an economy cannot grow indefinitely solely based on a shift of resources from low- to high-productivity activities. In other words, growth based on structural change will eventually peter out and, beyond a certain point, it should be supported by investment in fundamentals to be sustained.

> 8 It has been shown that the differential performance between successful and unsuccessful countries can be largely attributed to the pace at which growth-enhancing structural change takes place (McMillan _et al_ ., 2014; Timmer _et al_ ., 2014).

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