The paper studies empirically the impact
of labour on the economic growth in Bulgaria
by applying the growth accounting approach.
It examines the relationship between labour
growth and real GDP growth measured
through their rates on a constant and on a
chain basis. The labour elasticity coefficient
in the production function is calculated by
substantiating four alternative approaches.
Based on the different elasticity coefficient
variants and the data on employment
dynamics, the range of impact of labour
on the realised rates of economic growth
is weighed. On the basis of the outcomes
of the investigation a conclusion is reached
that real GDP growth in the period 1994-
1995 and 2002-2008 was under the
positive and changeable over time impact
of employment which, except for 1995, was
weaker than the impact from developments
in capital and total factor productivity. The
effect from labour developments is most
pronounced in episodes of negative or low
positive rates of real GDP growth as was the
case in 1992-1993, 1997 and the post-2009
interval, and is strongly negative. A similar
negative effect is also observed in the period
1998-2000, however weaker compared to
the consequences from developments in
the rest of the supply-driven growth factors