Has Low Productivity Constrained Competitiveness of African Firms?: Comparison of the Firm Performances with Asian Firms

Takahiro Fukunishi

No 129, IDE Discussion Papers from Institute of Developing Economies, Japan External Trade Organization(JETRO)

Abstract: It has been argued that poor productive performance is one of critical sources of stagnation of the African manufacturing sector, but firm-level empirical supports are limited. Using the inter-regional firm data of the garment industry, technical efficiency and its contribution to competitiveness measured as unit costs were compared between Kenyan and Bangladeshi firms. Our estimates indicated that there is no significant gap in the average technical efficiency of the two industries despite conservative estimation, although unit costs greatly differ between the two industries. Higher unit cost in Kenyan firms mainly stems from high labour cost, while impact of inefficiency is quite small. Productivity accounts little for the stagnation of garment industry in several African countries.

Keywords: Technical efficiency; Allocative efficiency; Manufacturing; Sub-Saharan Africa; Productivity; Manufacturing industries; Kenya; Bangladesh; 技術効率; 配分効率; サハラ以南アフリカ; 生産性; 製造業; ケニア; バングラデシュ (search for similar items in EconPapers)
JEL-codes: D24 L67 O33 (search for similar items in EconPapers)
Date: 2007-12-01
New Economics Papers: this item is included in nep-afr, nep-dev and nep-eff
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Published in IDE Discussion Paper = IDE Discussion Paper, No. 129. 2007-12-01

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