Manufacturing firms in Africa: Some stylized facts about wages and productivity

Clarke, George (2012): Manufacturing firms in Africa: Some stylized facts about wages and productivity.

Abstract

Why have so few countries in Sub-Saharan Africa been successful in export-oriented manufacturing? This paper uses firm-level data from the World Bank’s Enterprise Surveys to discuss this. The paper shows that although firms in most African countries are relatively unproductive, they are more productive on average than firms in other countries at similar levels of development. Further, even though many Africans earn subsistence wages working for informal firms, formal firms have higher labor costs than firms in other low-income countries. The paper discusses several possible reasons for this including the effect of the poor institutional environment on profits and the effect of limited competition on productivity measurement.

• Item Type: MPRA Paper
• Language: English
• Keywords: Africa, Zambia, Productivity, Manufacturing, Wages, East Asia
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O2 - Development Planning and Policy > O25 - Industrial Policy; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O14 - Industrialization ; Manufacturing and Service Industries ; Choice of Technology; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O12 - Microeconomic Analyses of Economic Development

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