Analysis of the Ethiopian Growth Model

Abstract

The master thesis examines the factors that make the Ethiopian growth model so successful in delivering a decade-long, double digit growth rate, thereby raising citizens’ income and living standards. It also assesses to which extent the growth model is able to sustain growth, particularly in a global uncertainty. The approach taken for the model review has been to assess if its development path was in line with the classical growth path and to conduct a benchmarking with the model of newly industrialized economies. Our findings indicate that what stands the Ethiopian growth model apart is its capacity to address the challenge of industrialization. As for growth sustainability, there are good reasons to believe in the capacity of the current economic fundamentals to help secure another period of high growth. However, the willingness of the leadership to adjust the model en-route and learn from newly industrialized economies will be decisive for growth to be sustained.