Is this time different? Social capability and catch-up growth in Ethiopia, 1950–2020

Abstract

This paper explores whether Ethiopia's rapid economic growth is transformative enough for the country to eventually catch up with high-income countries. It does so by exploring the change and continuity of four elements of social capability from 1950 to 2020: structural transformation, economic inclusion and the state's autonomy and accountability. It finds that Ethiopia's social capability modestly strengthened until the mid-1970s, then weakened until the early 2000s, and has since strengthened again. However, the level of inclusion has been persistently low. In conclusion, although there are grounds for optimism, limited economic inclusion is a key concern for future catch-up growth.