Advanced Search
MyIDEAS: Login to save this paper or follow this series

Explaining Africa's (Dis)advantage

Contents:

Author Info

  • Harrison, Ann E.
  • Lin, Justin Yifu
  • Xu, L. Colin

Abstract

Africa's economic performance has been widely viewed with pessimism. In this paper, firm-level data for around 80 countries are used to examine formal firm performance. Without controls, manufacturing African firms perform significantly worse than firms in other regions. They have lower productivity levels and growth rates, export less, and have lower investment rates. Once geography, political competition and the business environment are controlled for, formal African firms lead in productivity levels and growth. Africa's conditional advantage is higher in low-tech than in high-tech manufacturing, and exists in manufacturing but not in services. The key factors explaining Africa's disadvantage at the firm level are lack of infrastructure, access to finance, and political competition.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www-wds.worldbank.org/servlet/WDSContentServer/WDSP/IB/2013/02/28/000158349_20130228084803/Rendered/PDF/wps6316.pdf
Download Restriction: no

Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6316.

as in new window
Length:
Date of creation: 01 Jan 2013
Date of revision:
Handle: RePEc:wbk:wbrwps:6316

Contact details of provider:
Postal: 1818 H Street, N.W., Washington, DC 20433
Phone: (202) 477-1234
Email:
Web page: http://www.worldbank.org/
More information through EDIRC

Related research

Keywords: Environmental Economics&Policies; Economic Theory&Research; Labor Policies; E-Business; Banks&Banking Reform;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Easterly, W & Levine, R, 1996. "Africa's Growth Tragedy : Policies and Ethnic Divisions," Papers, Harvard - Institute for International Development 536, Harvard - Institute for International Development.
  2. Rita Almeida & Pedro Carneiro, 2006. "Enforcement of regulation, informal labor and firm performance," CeMMAP working papers, Centre for Microdata Methods and Practice, Institute for Fiscal Studies CWP02/06, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  3. Jeffry M. Netter & William L. Megginson, 2001. "From State to Market: A Survey of Empirical Studies on Privatization," Journal of Economic Literature, American Economic Association, American Economic Association, vol. 39(2), pages 321-389, June.
  4. James Tybout, 1998. "Manufacturing Firms In Developing Countries: How Well Do They Do, And Why?," Development and Comp Systems, EconWPA 9805004, EconWPA.
  5. Paul R. Rosenbaum, 2010. "Evidence factors in observational studies," Biometrika, Biometrika Trust, Biometrika Trust, vol. 97(2), pages 333-345.
  6. Claessens, Stijn & Laeven, Luc, 2002. "Financial development, property rights, and growth," Policy Research Working Paper Series, The World Bank 2924, The World Bank.
  7. Levine, Ross, 1996. "Financial development and economic growth : views and agenda," Policy Research Working Paper Series, The World Bank 1678, The World Bank.
  8. Paul Collier & Marcel Fafchamps & Francis Teal & Stefan Dercon, 2002. "Do African Manufacturing Firms Learn from Exporting?," Economics Series Working Papers, University of Oxford, Department of Economics WPS/2002-09, University of Oxford, Department of Economics.
  9. Steven J. DAVIS & John HALTIWANGER, 1996. "Employer Size and the Wage Structure in U.S. Manufacturing," Annales d'Economie et de Statistique, ENSAE, issue 41-42, pages 323-367.
  10. AfDB AfDB, . "Africa Competitiveness Report 2009," Africa Competitiveness Report, African Development Bank, African Development Bank, number 11 edited by Adeleke Oluwole Salami, 9.
  11. Foster, Lucia & Haltiwanger, John C. & Syverson, Chad, 2005. "Reallocation, Firm Turnover, and Efficiency: Selection on Productivity or Profitability?," IZA Discussion Papers 1705, Institute for the Study of Labor (IZA).
  12. Simeon Djankov & Rafael La Porta & Florencio Lopez-de-Silane & Andrei Shleifer & Juan Botero, 2003. "The Regulation of Labor," NBER Working Papers 9756, National Bureau of Economic Research, Inc.
  13. Ann E. Harrison & Brian J. Aitken, 1999. "Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela," American Economic Review, American Economic Association, American Economic Association, vol. 89(3), pages 605-618, June.
  14. Daniel Lederman & Taye Mengistae & Lixin Colin Xu, 2013. "Microeconomic consequences and macroeconomic causes of foreign direct investment in southern African economies," Applied Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 45(25), pages 3637-3649, September.
  15. Nicholas Stern, 2002. "A Strategy for Development," World Bank Publications, The World Bank, number 15213, August.
  16. Klapper, Leora & Laeven, Luc & Rajan, Raghuram, 2006. "Entry regulation as a barrier to entrepreneurship," Journal of Financial Economics, Elsevier, Elsevier, vol. 82(3), pages 591-629, December.
  17. Asli Demirgüç-Kunt & Vojislav Maksimovic, 1998. "Law, Finance, and Firm Growth," Journal of Finance, American Finance Association, American Finance Association, vol. 53(6), pages 2107-2137, December.
  18. Daron Acemoglu & Simon Johnson, 2005. "Unbundling Institutions," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 113(5), pages 949-995, October.
  19. T. Dinh, Hinh & Mavridis, Dimitris A. & Nguyen, Hoa B., 2010. "The binding constraint on firms'growth in developing countries," Policy Research Working Paper Series, The World Bank 5485, The World Bank.
  20. Long, Cheryl & Zhang, Xiaobo, 2009. "Cluster-based industrialization in China: Financing and performance," IFPRI discussion papers, International Food Policy Research Institute (IFPRI) 937, International Food Policy Research Institute (IFPRI).
  21. Sleuwaegen, Leo & Goedhuys, Micheline, 2002. "Growth of firms in developing countries, evidence from Cote d'Ivoire," Journal of Development Economics, Elsevier, Elsevier, vol. 68(1), pages 117-135, June.
  22. Dollar, David & Hallward-Driemeier, Mary & Mengistae, Taye, 2005. "Investment Climate and Firm Performance in Developing Economies," Economic Development and Cultural Change, University of Chicago Press, University of Chicago Press, vol. 54(1), pages 1-31, October.
  23. Friedrich Schneider & Andreas Buehn & Claudio E. Montenegro, 2010. "Shadow Economies All over the World: New Estimates for 162 Countries from 1999 to 2007," Working Papers, University of Chile, Department of Economics wp322, University of Chile, Department of Economics.
  24. Platteau, Jean-Philippe, 2009. "Institutional obstacles to African economic development: State, ethnicity, and custom," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 71(3), pages 669-689, September.
  25. Jean-Jacques Dethier & Maximilian Hirn & Stéphane Straub, 2011. "Explaining Enterprise Performance in Developing Countries with Business Climate Survey Data," World Bank Research Observer, World Bank Group, World Bank Group, vol. 26(2), pages 258-309, August.
  26. Thorsten Beck & Asli Demirgüç-Kunt & Vojislav Maksimovic, 2005. "Financial and Legal Constraints to Growth: Does Firm Size Matter?," Journal of Finance, American Finance Association, American Finance Association, vol. 60(1), pages 137-177, 02.
  27. Bigsten, Arne & Soderbom, Mans, 2005. "What have we learned from a decade of manufacturing enterprise surveys in Africa ?," Policy Research Working Paper Series, The World Bank 3798, The World Bank.
  28. Fafchamps, Marcel, 2000. "Ethnicity and credit in African manufacturing," Journal of Development Economics, Elsevier, Elsevier, vol. 61(1), pages 205-235, February.
  29. Jagadeesh Sivadasan & Amil Petrin, 2007. "Job Security Does Affect Economic Efficiency, Theory, A New Statistic, and Evidence from Chile," 2007 Meeting Papers, Society for Economic Dynamics 183, Society for Economic Dynamics.
  30. Taye Mengistae & Catherine Pattillo, 2004. "Export Orientation and Productivity in Sub-Saharan Africa," IMF Staff Papers, Palgrave Macmillan, vol. 51(2), pages 6.
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 in new window

Cited by:
  1. McKenzie, David, 2011. "How can we learn whether firm policies are working in africa ? challenges (and solutions?) for experiments and structural models," Policy Research Working Paper Series, The World Bank 5632, The World Bank.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:6316. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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