Productivity growth is seen as the key driver of long-run economic development but Pakistan’s total factor productivity growth has been mostly stagnant since the 1970s. This talk looks at a few key reasons underlying the differences between exporters and non-exporters in the Pakistani context to understand where the disconnect with export-led growth may lie.

First, the panelists examine how agglomeration relates to firm entry and productivity, considering both new and established clusters. Second, they focus on how different types of innovations affect firm productivity and growth and if they are related to export status. In Pakistan, exporters tend to be the largest firms, while innovation and firm growth mainly arise from smaller firms. Third, they also consider whether opening up to trade, following the examples of the Asian Tigers, holds promise to advance firm-level productivity. Finally, the discussion examines if intra-industry linkages between exporters and non-exporters can magnify and promote broader productivity growth through spillovers.