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Wages and Labor Management in African Manufacturing

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  • Marcel Fafchamps
  • Måns Söderbom

Abstract

Using matched employer-employee data on 10 African countries, this paper examines the rela- tionship beween wages, worker supervision, and labor productivity in manufacturing. Wages increase with Þrm size for both production workers and supervisors. We develop a two-tier model of super- vision that can account for this stylized fact and we Þt the structural model to the data. Employee data is used to derive a Þrm-speciÞc wage premium that is purged of the effect of worker observables. We Þnd a strong effect of both supervision and wages on effort and hence on labor productivity. La- bor management in sub-Saharan Africa appears problematic, with much higher supervisor-to-worker ratios than in Morocco and a higher elasticity of effort with respect to supervision.

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Bibliographic Info

Paper provided by Centre for the Study of African Economies, University of Oxford in its series CSAE Working Paper Series with number 2004-02.

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Date of creation: 2004
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Handle: RePEc:csa:wpaper:2004-02

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References

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Citations

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Cited by:
  1. Marcel Fafchamps, 2007. "Human Capital, Exports, and Wages," Economics Series Working Papers GPRG-WPS-069, University of Oxford, Department of Economics.
  2. Christophe Muller & Christophe J. Nordman, 2013. "Task Organization, Human Capital and Wages in Moroccan Exporting Firms," Working Papers halshs-00854522, HAL.
  3. Arjun Jayadev & Samuel Bowles, 2004. "Guard Labor: An Essay in Honor of Pranab Bardhan," Working Papers wp90, Political Economy Research Institute, University of Massachusetts at Amherst.
  4. Perroni, Carlo & Proto, Eugenio, 2007. "Moral Hazard and Entrepreneurial Failure in a Two-sector Model of Productive Matching - with an Application to the Natural Resource Curse," The Warwick Economics Research Paper Series (TWERPS) 796, University of Warwick, Department of Economics.
  5. Paul Beaudry & Patrick Francois, 2005. "Managerial Skill Acquisition and the Theory of Economic Development," NBER Working Papers 11451, National Bureau of Economic Research, Inc.
  6. Christophe Muller & Christophe Nordman, 2006. "Wages and Human Capital in Exporting Firms in Morocco," Working Papers DT/2006/06, DIAL (Développement, Institutions et Mondialisation).
  7. Marcel Fafchamps & Mans Söderbom & Najy Benhassine, 2009. "Wage Gaps and Job Sorting in African Manufacturing," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 18(5), pages 824-868, November.
  8. Guiying (Laura) Wu, 2013. "Investment Frictions and the Aggregate Output Loss in China," Economic Growth centre Working Paper Series 1307, Nanyang Technolgical University, School of Humanities and Social Sciences, Economic Growth centre.
  9. Arne Bigsten & Mans Söderbom, 2006. "What Have We Learned from a Decade of Manufacturing Enterprise Surveys in Africa?," World Bank Research Observer, World Bank Group, vol. 21(2), pages 241-265.
  10. Fafchamps, Marcel & Gabre-Madhin, Eleni Z., 2006. "Agricultural markets in Benin and Malawi," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 1(1), December.
  11. Fox, Louise & Oviedo, Ana Maria, 2008. "Are skills rewarded in Sub-Saharan Africa ? determinants of wages and productivity in the manufacturing sector," Policy Research Working Paper Series 4688, The World Bank.
  12. Jellal, Mohamed, 2012. "Maroc salaire minimum emploi et pauvreté
    [Morocco minimum wage employment and poverty]
    ," MPRA Paper 38491, University Library of Munich, Germany.
  13. Tetsushi Sonobe & John Akoten & Keijiro Otsuka, 2011. "The growth process of informal enterprises in Sub-Saharan Africa: a case study of a metalworking cluster in Nairobi," Small Business Economics, Springer, vol. 36(3), pages 323-335, April.

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