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Wages and Labour Productivity in African Manufacturing

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  • Joseph Mawejje
  • Ibrahim Mike Okumu

Abstract

We examine the relationship between labour productivity and wages using a sample of manufacturing firms in 39 African countries. The analysis is based on the World Bank's enterprise survey data. Controlling for regressor endogeneity and country fixed effects, our main finding is that wages reflect labour productivity and worker skills. In addition, the adoption of management quality standards, foreign ownership, and location in the capital city are all positively associated with wages. Female workers and adverse business environments characterized by electricity outages and bribery are negatively associated with wages. These findings are robust to inclusion of control variables, alternative measures of labour productivity, and exclusion of firms located in upper middle income countries and North Africa.

Suggested Citation

  • Joseph Mawejje & Ibrahim Mike Okumu, 2018. "Wages and Labour Productivity in African Manufacturing," African Development Review, African Development Bank, vol. 30(4), pages 386-398, December.
  • Handle: RePEc:bla:afrdev:v:30:y:2018:i:4:p:386-398
    DOI: 10.1111/1467-8268.12346
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    Cited by:

    1. Ibrahim Mike Okumu & Patricia Naluwooza & Edward Bbaale, 2022. "Firm Dynamics, Job Creation and Job Destruction in Africa: Is the Quality of Institutional Environment Relevant?," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(6), pages 2970-3004, December.
    2. Cyprian Amutabi & Anthony Wambugu, 2020. "Determinants of labor productivity among SMEs and large‐sized private service firms in Kenya," African Development Review, African Development Bank, vol. 32(4), pages 591-604, December.
    3. Ibrahim Mike Okumu & Joseph Mawejje, 2020. "Labour productivity in African manufacturing: Does the level of skills development matter?," Development Policy Review, Overseas Development Institute, vol. 38(4), pages 441-464, July.
    4. Albert Makochekanwa & Mamello Amelia Nchake, 2019. "Do Female Managers Affect Productivity? Evidence from Zimbabwean Manufacturing Firms," African Development Review, African Development Bank, vol. 31(3), pages 364-379, September.
    5. Zewdie Habte Shikur, 2020. "Industrial policy measure and economic structure in Ethiopia: the case of Oromia region," International Journal of Economic Policy Studies, Springer, vol. 14(1), pages 255-274, February.
    6. Gaston Brice Nkoumou Ngoa & Roger Tsafack Nanfosso & Benjamin Fomba Kamga, 2021. "Le recours des professionnels de santé à la pluriactivité dans un pays en développement: Le cas des métropoles du Cameroun," African Development Review, African Development Bank, vol. 33(2), pages 249-262, June.
    7. Ebo Botchway & Kofi Fred Asiedu, 2020. "Ownership type and earnings gap decomposition: Evidence from the Ghanaian labor market," African Development Review, African Development Bank, vol. 32(4), pages 619-631, December.

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