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What drives the dynamics of employment growth in firms? Evidence from East Africa

Author

Listed:
  • Blessing Atwine

    (Makerere University)

  • Ibrahim Mike Okumu

    (Makerere University)

  • John Bosco Nnyanzi

    (Makerere University)

Abstract

This study examines the firm level drivers of employment growth in East Africa in which they are categorized as firm specific, entrepreneur specific and business environment characteristics. Using a cross-sectional World Bank Enterprise survey dataset and pooled Ordinary Least Squares estimation (OLS), the results indicate that; (1) employment growth is significantly associated with firm specific characteristics (employment growth is positively related to firm size and innovation while it is negatively associated with the age of the firm), (2) a weak business environment characterized by electricity outages, informal payments and poor court system undermines the firm’s ability to contribute to employment growth while strong business environment such as access to finance is positively associated with employment growth (3) employment growth is also positively influenced by managerial experience. Policy recommendations are suggested.

Suggested Citation

  • Blessing Atwine & Ibrahim Mike Okumu & John Bosco Nnyanzi, 2023. "What drives the dynamics of employment growth in firms? Evidence from East Africa," Journal of Innovation and Entrepreneurship, Springer, vol. 12(1), pages 1-25, December.
    • Handle: RePEc:spr:joiaen:v:12:y:2023:i:1:d:10.1186_s13731-023-00295-y
    DOI: 10.1186/s13731-023-00295-y
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    More about this item

    Keywords

    East Africa; Employment growth; Firm; Entrepreneur; Business environment;
    All these keywords.

    JEL classification:

    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • D2 - Microeconomics - - Production and Organizations
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O5 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies

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