Sources, Reserves, and Convergence of the Serbian Economic Growth - Jobless Growth of the Serbian Economy

The topic of this paper is an analysis of the growth of the Serbian economy. The paper is primarily devoted to the analysis of the sources of growth of the Serbian economy. In this regard, apart from conventional decomposition of growth (into contributions of capital, labor, and total factor productivity), the demand side and the industry composition sides of the sources-of-growth analysis are also considered. Furthermore, on the basis of these results, the reserves for further growth of the gross domestic product per capita are identified and estimated. Special attention is given to a possible increase in the total factor productivity, induced by the advance in “broader knowledge”, and to an increase in the labor participation rate. Institutional and policy prerequisites for realization of these reserves of growth are also briefly analyzed. Finally, on the basis of different assumptions regarding magnitudes of realization of these reserves, future convergence of the Serbian economy toward E15 and E27 countries is given.