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An Econometric Model of Employment in Zimbabwe's Manufacturing Industries

Author

Listed:
  • Heshmati, Almas

    (Dept. of Economic Statistics, Stockholm School of Economics)

  • Ncube, Mkhululi

    (Dept. of Economics, Göteborg University)

Abstract

This paper is concerned with the estimation of an employment relationship and employment efficiency under production risk using a panel of Zimbabwe's manufacturing industries. A flexible labour demand functions are used and consist of two parts: the traditional labour demand function and labour demand variance function. Labour demand is a function of wages, output, quasi-fixed inputs and time variables. The variance function is a function of the determinants of labour demand and a number of production and policy characteristic variables. It appears in a multiplicative form with the demand function and it accommodates both positive and negative marginal effects with respect to the determinants of the variance. A multi-step procedure is used to estimate the parameters of the model. Estimation of industry and time-varying employment efficiency is also considered. Employment efficiency is defined in terms of the distance from the employment frontier defined as minimum employment required to produce a given level of output. The empirical results show that the average employment efficiency is 92%.

Suggested Citation

  • Heshmati, Almas & Ncube, Mkhululi, 1998. "An Econometric Model of Employment in Zimbabwe's Manufacturing Industries," SSE/EFI Working Paper Series in Economics and Finance 277, Stockholm School of Economics, revised 15 Aug 2003.
    • Handle: RePEc:hhs:hastef:0277
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    References listed on IDEAS

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    More about this item

    Keywords

    Labour demand; variance; efficiency; manufacturing industries; Zimbabwe;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity

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