IDEAS home Printed from https://ideas.repec.org/a/eee/wdevel/v64y2014icp713-725.html
   My bibliography  Save this article

Technology and Productivity in African Manufacturing Firms

Author

Listed:
  • Baptist, Simon
  • Teal, Francis

Abstract

We find that heterogeneity in production functions is an important source of variation in firm outcomes in Africa, and we find it is more important than education or productivity in explaining differences in output per worker. There is some technological diversity within Africa, with more dependence on raw materials in poor countries and higher returns to education in richer countries. This suggests that parameter evolution is an important element of modeling the nature of technical change, and that development policy should consider technological change as a mechanism to increase growth as well as augmenting factor stocks or total factor productivity.

Suggested Citation

  • Baptist, Simon & Teal, Francis, 2014. "Technology and Productivity in African Manufacturing Firms," World Development, Elsevier, vol. 64(C), pages 713-725.
    • Handle: RePEc:eee:wdevel:v:64:y:2014:i:c:p:713-725
    DOI: 10.1016/j.worlddev.2014.07.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0305750X1400206X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.worlddev.2014.07.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Caselli, Francesco, 2005. "Accounting for Cross-Country Income Differences," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 9, pages 679-741, Elsevier.
    2. Susanto Basu & David N. Weil, 1998. "Appropriate Technology and Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(4), pages 1025-1054.
    3. Sofronis K. Clerides & Saul Lach & James R. Tybout, 1998. "Is Learning by Exporting Important? Micro-Dynamic Evidence from Colombia, Mexico, and Morocco," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(3), pages 903-947.
    4. Young, Alwyn, 1994. "Lessons from the East Asian NICS: A contrarian view," European Economic Review, Elsevier, vol. 38(3-4), pages 964-973, April.
    5. George Psacharopoulos & Harry Anthony Patrinos, 2004. "Returns to investment in education: a further update," Education Economics, Taylor & Francis Journals, vol. 12(2), pages 111-134.
    6. Soderbom, Mans & Teal, Francis, 2004. "Size and efficiency in African manufacturing firms: evidence from firm-level panel data," Journal of Development Economics, Elsevier, vol. 73(1), pages 369-394, February.
    7. Waldkirch, Andreas & Ofosu, Andra, 2010. "Foreign Presence, Spillovers, and Productivity: Evidence from Ghana," World Development, Elsevier, vol. 38(8), pages 1114-1126, August.
    8. Johnson, Simon & Larson, William & Papageorgiou, Chris & Subramanian, Arvind, 2013. "Is newer better? Penn World Table Revisions and their impact on growth estimates," Journal of Monetary Economics, Elsevier, vol. 60(2), pages 255-274.
    9. Hay, Donald A, 2001. "The Post-1990 Brazilian Trade Liberalisation and the Performance of Large Manufacturing Firms: Productivity, Market Share and Profits," Economic Journal, Royal Economic Society, vol. 111(473), pages 620-641, July.
    10. Luc Christiaensen & Lionel Demery & Stefano Paternostro, 2003. "Macro and Micro Perspectives of Growth and Poverty in Africa," The World Bank Economic Review, World Bank, vol. 17(3), pages 317-347, December.
    11. Van Biesebroeck, Johannes, 2005. "Exporting raises productivity in sub-Saharan African manufacturing firms," Journal of International Economics, Elsevier, vol. 67(2), pages 373-391, December.
    12. Caselli, Francesco, 2005. "Accounting for cross-country income differences," LSE Research Online Documents on Economics 5266, London School of Economics and Political Science, LSE Library.
    13. Shiferaw, Admasu, 2009. "Survival of Private Sector Manufacturing Establishments in Africa: The Role of Productivity and Ownership," World Development, Elsevier, vol. 37(3), pages 572-584, March.
    14. Francesco Caselli & James Feyrer, 2007. "The Marginal Product of Capital," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(2), pages 535-568.
    15. Jorgenson, Dale W. & Kuroda, Masahiro & Nishimizu, Mieko, 1987. "Japan-U.S. industry-level productivity comparisons, 1960-1979," Journal of the Japanese and International Economies, Elsevier, vol. 1(1), pages 1-30, March.
    16. Serven, Luis, 1997. "Irreversibility, Uncertainty and Private Investment: Analytical Issues and Some Lessons for Africa," Journal of African Economies, Centre for the Study of African Economies, vol. 6(3), pages 229-268, Supplemen.
    17. Simon Baptist & Francis Teal, 2008. "Why do South Korean firms produce so much more output per worker than Ghanaian ones?," CSAE Working Paper Series 2008-10, Centre for the Study of African Economies, University of Oxford.
    18. Chen, Tain-jy & Tang, De-piao, 1987. "Comparing technical efficiency between import-substitution-oriented and export-oriented foreign firms in a developing economy," Journal of Development Economics, Elsevier, vol. 26(2), pages 277-289, August.
    19. Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 83-116.
    20. Harrigan, James, 1999. "Estimation of cross-country differences in industry production functions," Journal of International Economics, Elsevier, vol. 47(2), pages 267-293, April.
    21. Francesco Caselli & Wilbur John Coleman II, 2006. "The World Technology Frontier," American Economic Review, American Economic Association, vol. 96(3), pages 499-522, June.
    22. Teal, Francis, 2000. "Real wages and the demand for skilled and unskilled male labour in Ghana's manufacturing sector: 1991-1995," Journal of Development Economics, Elsevier, vol. 61(2), pages 447-461, April.
    23. Clarke, George, 2012. "Manufacturing firms in Africa: Some stylized facts about wages and productivity," MPRA Paper 36122, University Library of Munich, Germany.
    24. Benn Eifert & Alan Gelb & Vijaya Ramachandran, 2005. "Business Environment and Comparative Advantage in Africa: Evidence from the Investment Climate Data," Working Papers 56, Center for Global Development.
    25. Neil Rankin & Måns Söderbom & Francis Teal, 2006. "Exporting from Manufacturing Firms in Sub-Saharan Africa," Journal of African Economies, Centre for the Study of African Economies, vol. 15(4), pages 671-687, December.
    26. Francis Teal & Simon Baptist, 2008. "Why do South Korean firms produce so much more output per worker than Ghanaian ones?," Economics Series Working Papers WPS/2008-10, University of Oxford, Department of Economics.
    27. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    28. Mary Hallward-Driemeier & Giuseppe Iarossi & Kenneth L. Sokoloff, 2002. "Exports and Manufacturing Productivity in East Asia: A Comparative Analysis with Firm-Level Data," NBER Working Papers 8894, National Bureau of Economic Research, Inc.
    29. Jerzmanowski, Michal, 2007. "Total factor productivity differences: Appropriate technology vs. efficiency," European Economic Review, Elsevier, vol. 51(8), pages 2080-2110, November.
    30. Bleaney, Michael F., 1996. "Macroeconomic stability, investment and growth in developing countries," Journal of Development Economics, Elsevier, vol. 48(2), pages 461-477, March.
    31. Caselli, Francesco, 2005. "Accounting for cross-country income differences," LSE Research Online Documents on Economics 3567, London School of Economics and Political Science, LSE Library.
    32. Ibarra, Luis Alberto, 1995. "Credibility of trade policy reform and investment: the Mexican experience," Journal of Development Economics, Elsevier, vol. 47(1), pages 39-60, June.
    33. repec:fth:harver:1487 is not listed on IDEAS
    34. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    35. Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Serneels, Pieter & Beegle, Kathleen & Dillon, Andrew, 2017. "Do returns to education depend on how and whom you ask?," Economics of Education Review, Elsevier, vol. 60(C), pages 5-19.
    2. Bresnahan, Lauren & Coxhead, Ian & Foltz, Jeremy & Mogues, Tewodaj, 2016. "Does Freer Trade Really Lead to Productivity Growth? Evidence from Africa," World Development, Elsevier, vol. 86(C), pages 18-29.
    3. Xuanting Li & Xiaohong Wang & Shaopeng Zhang, 2022. "Impacts of Urban Spatial Development Patterns on Carbon Emissions: Evidence from Chinese Cities," Land, MDPI, vol. 11(11), pages 1-16, November.
    4. Matthias Brönner & Skander Salah & Markus Lienkamp, 2020. "Production Challenges in Least Developed Countries," Challenges, MDPI, vol. 11(1), pages 1-20, January.
    5. Ibrahim Mike Okumu & Joseph Mawejje, 2020. "Labour productivity in African manufacturing: Does the level of skills development matter?," Development Policy Review, Overseas Development Institute, vol. 38(4), pages 441-464, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Massimo Del Gatto & Adriana Di Liberto & Carmelo Petraglia, 2011. "Measuring Productivity," Journal of Economic Surveys, Wiley Blackwell, vol. 25(5), pages 952-1008, December.
    2. Harald Fadinger & Pablo Fleiss, 2011. "Trade and Sectoral Productivity," Economic Journal, Royal Economic Society, vol. 121(555), pages 958-989, September.
    3. Marcelo Soto, 2006. "The Causal Effect of Education on Aggregate Income," Working Papers 0605, International Economics Institute, University of Valencia.
    4. Danish Ahmed SIDDIQUI & Qazi Masood AHMED, 2019. "Are institutions a crucial determinant of cross country economic efficiency? A two-stage double bootstrap data envelopment analysis," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(1(618), S), pages 89-114, Spring.
    5. repec:agr:journl:v:1(618):y:2019:i:1(618):p:89-114 is not listed on IDEAS
    6. Bryan Graham & Jonathan Temple, 2006. "Rich Nations, Poor Nations: How Much Can Multiple Equilibria Explain?," Journal of Economic Growth, Springer, vol. 11(1), pages 5-41, March.
    7. Jakub Growiec, 2013. "On the measurement of technological progress across countries," Bank i Kredyt, Narodowy Bank Polski, vol. 44(5), pages 467-504.
    8. Bresnahan, Lauren & Coxhead, Ian & Foltz, Jeremy & Mogues, Tewodaj, 2016. "Does Freer Trade Really Lead to Productivity Growth? Evidence from Africa," World Development, Elsevier, vol. 86(C), pages 18-29.
    9. Decreux, Yvan & Ramos, Maria Priscila, 2007. "How does tariff-rate quota modelling affect CGE results? An application for MIRAGE," Working Papers 7206, TRADEAG - Agricultural Trade Agreements.
    10. Caselli, Francesco & Ciccone, Antonio, 2013. "The contribution of schooling in development accounting: Results from a nonparametric upper bound," Journal of Development Economics, Elsevier, vol. 104(C), pages 199-211.
    11. Francis Teal & Simon Baptist, 2008. "Why do South Korean firms produce so much more output per worker than Ghanaian ones?," Economics Series Working Papers WPS/2008-10, University of Oxford, Department of Economics.
    12. Magalhães, Manuela & Afonso, Óscar, 2017. "A multi-sector growth model with technology diffusion and networks," Research Policy, Elsevier, vol. 46(7), pages 1340-1359.
    13. Koffi Délali Kpognon & Henri Atangana Ondoa & Mamadou Bah & Peter Asare-Nuamah, 2022. "Fostering Labour Productivity Growth for Productive and Decent Job Creation in Sub-Saharan African Countries: the Role of Institutional Quality," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(3), pages 1962-1992, September.
    14. Jerzmanowski, Michal, 2007. "Total factor productivity differences: Appropriate technology vs. efficiency," European Economic Review, Elsevier, vol. 51(8), pages 2080-2110, November.
    15. Gomes Neto, Delfim & Veiga, Francisco José, 2013. "Financial globalization, convergence and growth: The role of foreign direct investment," Journal of International Money and Finance, Elsevier, vol. 37(C), pages 161-186.
    16. KPOGNON, Koffi & BAH, Mamadou, 2019. "Does institutional quality contribute to increasing labour productivity in sub-Saharan Africa? An empirical analysis," MPRA Paper 98674, University Library of Munich, Germany.
    17. Löschel, Andreas & Pothen, Frank & Schymura, Michael, 2015. "Peeling the onion: Analyzing aggregate, national and sectoral energy intensity in the European Union," Energy Economics, Elsevier, vol. 52(S1), pages 63-75.
    18. Mike Waugh & David Lagakos & Doug Gollin, 2011. "The Agricultural Productivity Gap in Developing Countries," 2011 Meeting Papers 1397, Society for Economic Dynamics.
    19. Castelló-Climent, Amparo & Mukhopadhyay, Abhiroop, 2013. "Mass education or a minority well educated elite in the process of growth: The case of India," Journal of Development Economics, Elsevier, vol. 105(C), pages 303-320.
    20. Jerzmanowski, Michal & Tamura, Robert, 2019. "Directed technological change & cross-country income differences: A quantitative analysis," Journal of Development Economics, Elsevier, vol. 141(C).
    21. Levchenko, Andrei A. & Zhang, Jing, 2016. "The evolution of comparative advantage: Measurement and welfare implications," Journal of Monetary Economics, Elsevier, vol. 78(C), pages 96-111.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:wdevel:v:64:y:2014:i:c:p:713-725. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/worlddev .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.