Growth, human capital, and technological change in a centrally planned economy: Evidence from Cuba

The purpose of this research is to improve understanding of Cuban economic growth and technological change during the period 1962-1988. An empirical growth accounting analysis is conducted to explain Cuba's process of economic growth.;This research has five sections. The first section is an introduction. The second section is a descriptive analysis of the historical patterns of Cuban economic growth, international trade, factor accumulation, human capital and social achievement. The third section contains estimates of Cuban aggregate and sectoral total factor productivity (TFP) based on the traditional methodology (Solow, 1957). Theoretical explanations of Cuba's rate of technical change, such as the extent to which technological change was embodied in capital, and economies of scale is included. The fourth section contains an econometric estimate of TFP for the purpose of validating previous results, which considers the well known assumptions of constant return to scale and perfect competition in factor markets. A comparative analysis of the TFP growth of Cuba and other world regions is conducted. The final section contains an analysis of the results, the implications for linear endogenous growth models and conclusions.;This research concludes that Cuba's centrally planned economy performed much worse than most capitalist economies with respect to TFP growth and its contribution to economic growth. Cuban growth was won by massive capital accumulation rather than technological progress.