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Labour Contracts and Performance of Cameroonian Firms

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  • Fomba Kamga, Benjamin

    ()
    (University of Yaounde II)

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    Abstract

    The aim of this study is to evaluate employees' productivity in relation to their contract status. This study uses (a) survey data collected among manufacturing sector firms, having more than 15 employees, in Cameroon between April and May 2006 and (b) information issued by the National Institute of Statistics. Information collected concerned 45 firms spanning the period 2003 to 2005. This study uses the stochastic production frontier, distinguishing employees holding fixed-term contract (FTC) from employees that do not have fixed-term contracts (indefinite-term contract (ITC)). Results are estimated in 2 stages. First, we evaluate the determinants of the utilisation of FTC workers and second, we estimate the level of efficiency and productivity of two types of workers. Empirical results indicate that employees holding FTC are twice more productive than those holding ITC. Likewise, parameters indicating returns to scale are 1.3. This parameter, though not significant, is greater than one indicating constant returns to scale in the firm production function.

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    Bibliographic Info

    Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6211.

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    Length: 29 pages
    Date of creation: Dec 2011
    Date of revision:
    Handle: RePEc:iza:izadps:dp6211

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    Related research

    Keywords: labour contract; fixed-term contract; indefinite-term contract; production frontier;

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    1. Abraham, Katharine G & Taylor, Susan K, 1996. "Firms' Use of Outside Contractors: Theory and Evidence," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 14(3), pages 394-424, July.
    2. Goux, Dominique & Maurin, Eric & Pauchet, Marianne, 2001. "Fixed-term contracts and the dynamics of labour demand," European Economic Review, Elsevier, Elsevier, vol. 45(3), pages 533-552, March.
    3. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, Elsevier, vol. 6(1), pages 21-37, July.
    4. Alison L Booth & Juan J. Dolado & Jeff Frank, 2002. "Symposium On Temporary Work Introduction," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 112(480), pages F181-F188, June.
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