Impact of Knowledge-based Components on Total Factor Productivity of MENA Countries

From the viewpoint of economic theories, total factor productivity (TFP) is the most important component that leads to economic growth and development. The main purpose of this study was to evaluate the impact of knowledge-based economy on total factor productivity in the member countries of the Middle East and North Africa (MENA) region. For this purpose, the panel data regression analysis has been designed to analyze the effect of knowledge-based economy components on total factor productivity in 14 member countries of MENA region for the period of 1995-2012. the results show that the growth of knowledge-based economy index such as education (coefficient= 0.51), information and communication technology ICT (coefficient= 0.31), innovation (coefficient= 0.62), and economic incentive and institutional regime (coefficient= 1.05) have positive and significant effects on total factor productivity of middle east and north africa (MENA) member countries for the time period of the study.