Selected Issues Papers

Potential Output in the Kyrgyz Republic: Kyrgyz Republic

By Nasir H Rao, Anvar Muratkhanov, Nihal Haider

June 18, 2025

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Format: Chicago

Nasir H Rao, Anvar Muratkhanov, and Nihal Haider. "Potential Output in the Kyrgyz Republic: Kyrgyz Republic", Selected Issues Papers 2025, 081 (2025), accessed July 10, 2025, https://doi.org/10.5089/9798229011624.018

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Summary

This paper revisits the potential output of the Kyrgyz Republic considering recent structural shifts and external shocks, including the pandemic and the regional conflict. Utilizing a suite of methodologies – production function, state-space models, and statistical filters – it estimates potential output growth at 5.3 percent, up from around 4.4 percent prior to the pandemic. This increase is primarily driven by capital accumulation and labor force expansion. However, total factor productivity remains below historical averages. The persistently positive output gap points to overheating risks, underscoring the need for counter-cyclical policies and structural reforms.

Subject: Labor, Labor markets, Output gap, Potential output, Production, Total factor productivity

Keywords: Capital Accumulation, Labor markets, Output Gap, Output gap dynamics, Output gap in the Kyrgyz Republic, Output gap point, Potential Output, Structural Reforms, TFP gain, TFP series, Total Factor Productivity

Publication Details

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