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Local and Personal Networks in Employment and the Development of Labor Markets:Evidence from the Cut Flower Industry in Ethiopia

  • Yukichi Mano

    (Foundation for Advanced Studies on International Development
    National Graduate Institute for Policy Studies)

  • Takashi Yamano

    (Foundation for Advanced Studies on International Development
    National Graduate Institute for Policy Studies)

  • Aya Suzuki

    (Foundation for Advanced Studies on International Development
    National Graduate Institute for Policy Studies)

  • Tomoya Matsumoto

    (National Graduate Institute for Policy Studies)

We examine the roles of local and personal networks in the employment process and the emergence and development of the labor market in Ethiopia’s growing cut flower industry. Using primary survey data of 320 workers randomly sampled from all 64 farms, we find that workers who were recruited informally using the social ties were paid less than the formally-recruited workers at hiring. However, these workers quickly increased their productivity, and the effect of social ties on wages disappeared over time. Further, we find that the development of labor market for this newly-emerged industry took place particularly within the industrial clusters (100 words).

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Paper provided by National Graduate Institute for Policy Studies in its series GRIPS Discussion Papers with number 10-29.

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Length: 38 pages
Date of creation: Jan 2011
Date of revision:
Handle: RePEc:ngi:dpaper:10-29
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