HOW PRODUCTIVITY, CAPITAL INVESTMENT, EMPLOYMENT, HUMAN CAPITAL AND ENERGY ARE AFFECTING ECONOMIC GROWTH IN MOROCCO? AN ARDL, FMOLS, DOLS AND CCR APPROACHES

Abstract

This paper aims to scrutinize the effects of; productivity, capital in-
vestment, human capital, employment and energy intensity; on eco-
nomic growth in Morocco under the Energy-augmented Cobb Doug-
las production function (CDPF) framework, using extended data
from 1965 to 2022. The ADF unit root test confirmed the existence
of cointegration among variables, then, the ARDL BTA/ECM model
proved the presence of long-term relationship within, in which the ex-
planatory variables progress all together positively and proportionally
to generate economic growth, just as stipulate the standard CDPF. The
outputs reliability was validated by FMOLS, DOLS, and CCR tests.
Results implies that an additional unit in GDP corresponds, in terms
of units to, 1.87 in productivity level, 0.12 in capital investment, 4.19
in of human capital, 0.98 in labor force and 2.52 in energy intensi-
ty, that Moroccan economy is human capital intensive unlike when it
comes to physical capital. In the light of this findings, we think that
Morocco should accelerate its industrial transition, proceed to a large
modernization and mechanisation of its agriculture in order to inspire
more productivity to its entire economy, keep acting in the sense of
more structural reforms to improve the business environment, share
out the public spending equitably following two dimensions, physical
by upgrading local infrastructure to attract more investments, human
by promoting human capital through education and social protection.