Inter-sectoral Interdependence and Growth in Vietnam : A Comparative Analysis with Indonesia and Malaysia

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This study examines the sources of output growth in Vietnam during 1996-2000using the national input-output (I-O) tables. It employs an extended growth-factordecomposition method, which is an extension of the standard growth-factordecomposition method, in which all industries are classified into the primary,secondary and tertiary sectors. It also conducts a comparative analysis of Vietnam,Indonesia and Malaysia. The major source of Vietnam's output growth was theexpansion of exports. The secondary sector played a key role in Vietnam's outputgrowth, as its demand effects induced more than half of total output growth,contributing not only to the output growth of the sector itself but also of the othertwo sectors through inter-industry linkages. Malaysia's growth pattern was similar toVietnam's, in which export expansion was the main driver of growth and thesecondary sector led output growth. However, heavy industries played a moreimportant role than light industries in Malaysia. Indonesia exhibits a markedlydifferent growth pattern than Vietnam and Malaysia, as its tertiary sector was a moreimportant driver of economic growth.


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