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Citation Information

Type Working Paper - SSRN eLibrary
Title Manufacturing Firms in Africa: Some Stylized Facts About Wages and Productivity
Publication (Day/Month/Year) 2012
URL http://ssrn.com/paper=1989681
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.

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