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What Determines Productivity in Senegal? Sectoral Disparities and the Dual Labour Market

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  • Damien Echevin
  • Fabrice Murtin

Abstract

This paper analyses the output gap between the formal and informal sectors in Senegal using a matched employer-employee database. While the production process in some informal sub-sectors is similar to the one in the formal sector, there is evidence that the economy is deeply cleaved between productive and non-productive firms within the informal sector and between voluntary and involuntary jobs on a labour market which proves to be dual. We find that education externalities are significant although modest in both sectors and that the differences in human and physical capital account for about two thirds of the output gap.

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  • Damien Echevin & Fabrice Murtin, 2009. "What Determines Productivity in Senegal? Sectoral Disparities and the Dual Labour Market," Journal of Development Studies, Taylor & Francis Journals, vol. 45(10), pages 1707-1730.
    • Handle: RePEc:taf:jdevst:v:45:y:2009:i:10:p:1707-1730
    DOI: 10.1080/00220380902935881
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    References listed on IDEAS

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    1. Swaminathan, M., 1991. "Understanding the "Informal Sector": A Survey," Research Paper 95, World Institute for Development Economics Research.
    2. Heckman, James J. & Lochner, Lance J. & Todd, Petra E., 2006. "Earnings Functions, Rates of Return and Treatment Effects: The Mincer Equation and Beyond," Handbook of the Economics of Education, in: Erik Hanushek & F. Welch (ed.), Handbook of the Economics of Education, edition 1, volume 1, chapter 7, pages 307-458, Elsevier.
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    Cited by:

    1. Boccanfuso, Dorothée & Larouche, Alexandre & Trandafir, Mircea, 2015. "Quality of Higher Education and the Labor Market in Developing Countries: Evidence from an Education Reform in Senegal," World Development, Elsevier, vol. 74(C), pages 412-424.
    2. repec:dau:papers:123456789/12185 is not listed on IDEAS
    3. Samuel Bates & Cheikh Tidiane Ndiaye, 2014. "Economic Growth from a Structural Unobserved Component Modeling: The Case of Senegal," Economics Bulletin, AccessEcon, vol. 34(2), pages 951-965.
    4. Akyeampong, Emmanuel & Fofack, Hippolyte, 2013. "The contribution of African women to economic growth and development in post-colonial Africa : historical perspectives and policy implications," Policy Research Working Paper Series 6537, The World Bank.
    5. Mohammad Amin & Cedric Okou, 2020. "Casting a shadow: Productivity of formal firms and informality," Review of Development Economics, Wiley Blackwell, vol. 24(4), pages 1610-1630, November.
    6. Danquah Michael & Schotte Simone & Sen Kunal, 2021. "Informal work in sub-Saharan Africa: Dead end or stepping-stone?," IZA Journal of Development and Migration, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 12(1), pages 1-44, January.
    7. Pape Yona Boubacar Mane & Abdoulaye Diagne & Yao thibaut Kpegli, 2019. "Modeling the Macroeconomic Effects of Disease: Extension and Application in the context of Senegal," Economics Bulletin, AccessEcon, vol. 39(4), pages 2904-2912.

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