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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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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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Citations

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Cited by:
  1. Christophe Muller & Christophe Nordman, . "Task Organization, Human Capital and Wages in Moroccan Exporting Firms," Discussion Papers, University of Nottingham, CREDIT 08/12, University of Nottingham, CREDIT.
  2. Guiying (Laura) Wu, 2013. "Investment Frictions and the Aggregate Output Loss in China," Economic Growth centre Working Paper Series, Nanyang Technolgical University, School of Humanities and Social Sciences, Economic Growth centre 1307, Nanyang Technolgical University, School of Humanities and Social Sciences, Economic Growth centre.
  3. 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, African Association of Agricultural Economists, vol. 1(1), December.
  4. Arjun Jayadev & Samuel Bowles, 2004. "Guard Labor: An Essay in Honor of Pranab Bardhan," Working Papers, Political Economy Research Institute, University of Massachusetts at Amherst wp90, Political Economy Research Institute, University of Massachusetts at Amherst.
  5. Christophe Muller & Christophe Nordman, 2005. "Wage And Human Capital In Exporting Firms In Morocco," Working Papers. Serie AD, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) 2005-14, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  6. Paul Beaudry & Patrick Francois, 2010. "Managerial Skills Acquisition and the Theory of Economic Development," Review of Economic Studies, Oxford University Press, Oxford University Press, vol. 77(1), pages 90-126.
  7. Marcel Fafchamps, 2007. "Human Capital, Exports, and Wages," Economics Series Working Papers, University of Oxford, Department of Economics GPRG-WPS-069, University of Oxford, Department of Economics.
  8. 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, The World Bank 4688, The World Bank.
  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, World Bank Group, vol. 21(2), pages 241-265.
  10. 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, Springer, vol. 36(3), pages 323-335, April.
  11. 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), University of Warwick, Department of Economics 796, University of Warwick, Department of Economics.
  12. 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), Centre for the Study of African Economies (CSAE), vol. 18(5), pages 824-868, November.
  13. Jellal, Mohamed, 2014. "Firmes industrielles incitations et formation approche théorique
    [Industrial firms incentives and training Policy theoretical approach]
    ," MPRA Paper 57306, University Library of Munich, Germany.
  14. Jellal, Mohamed, 2012. "Maroc salaire minimum emploi et pauvreté
    [Morocco minimum wage employment and poverty]
    ," MPRA Paper 38491, University Library of Munich, Germany.

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