Prof. Rodrik of Harvard University: ‘Keep an Eye on the Manufacturing Industry and Services Sector for Sustaining Structural Transformation’ Watch video Dani Rodrik, commenting on Turkey's economy underlined that rate at which manufacturing is expanding employment has slowed down and many of the services that are growing are not as productive.

ANKARA - Prof. Dani Rodrik of Harvard University stated that it will be important for rapid, productivity-enhancing structural change to be sustained in order for Turkey to maintain its high rate of economic growth. Rodrik maintained that this may become more difficult over time, 'as the rate at which manufacturing is expanding employment has slowed down and many of the services that are growing are not as productive'.

In the scope of this year's 'Merih Celasun Memorial Day' event on 22 December 2010, Rodrik delivered a memorial lecture with the theme 'Structural Transformation and Economic Development'. Rodrik stressing that Prof. Merih Celasun gave the earliest and the must successful works on the structural transformation in Turkey evaluated the progress made so far in terms of Turkey's economic transformation. Rodrik went on to say that as also repeatedly maintained by Celasun, the degree to which the environment is conducive to rapid structural change was a key determinant of economic success and that structural change determined not only the pace of economic growth but also the evolution of income distribution.

Drawing attention to the productivity gaps in the Turkish economy across diffferent sectors, Rodrik identified the large gap between the agricultural sector which provides almost one fourth of employment and public utilities. Rodrik underlined that average productivity in manufacturing exceeds that in agriculture by a factor of three and productivity in community, personal, and government services  and wholesale and retail trade also stands below the average. Rodrik maintained: "Getting labor to move from one of these sectors to manufacturing or any of the other high productivity sectors would provide a significant boost to real incomes."

Turkey looks more Asian

Concerning the contribution of structural change to growth, Rodrik said: "It is also encouraging that the structural change component has actually increased in size more recently even though its share in overall growth has fallen somewhat." Also commenting on the performance of Latin American and Asian countries, Rodrik stressed that Turkey looks decidedly more Asian than Latin American in terms of the positive contribution that structural change has made to overall labor productivity growth.

Participants of the Memorial Day included Prof. Celasun's family, students, friends, colleagues and guests from a number of different institutions and organizations.

'Merih Celasun Award'

At the event TEPAV Director Prof. Güven Sak also delivered a speech composing of anecdotes about Merih Celasun. In his speech, Sak maintained that TEPAV carries out research to close the strategy gap with respect to fighting inflation in the period of 2001 crisis as Prof. Celasun used to complain about. Sak said that being the first event of the series, this event witnessed highly emotional moments whereas the 'Merih Celasun Memorial Day' events in the future years are expected to serve as a platform which will be dominated by economic debates. Sak underlined that with the 'Merih Celasun Award' academic research will be supported in this context and stated that the regulations for the award will be announced in the first quarter of 2011.

The meeting proceeded with memorial lectures for Prof. Merih Celasun.