An Econometric Model of Employment in Zimbabwe's Manufacturing Industries

Almas Heshmati () and Mkhululi Ncube
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Mkhululi Ncube: Dept. of Economics, Göteborg University, Postal: Box 640, 405 30 Göteborg,

No 277, SSE/EFI Working Paper Series in Economics and Finance from Stockholm School of Economics

Abstract: This paper is concerned with the estimation of an employment relationship and employment efficiency under production risk using a panel of Zimbabwe's manufacturing industries. A flexible labour demand functions are used and consist of two parts: the traditional labour demand function and labour demand variance function. Labour demand is a function of wages, output, quasi-fixed inputs and time variables. The variance function is a function of the determinants of labour demand and a number of production and policy characteristic variables. It appears in a multiplicative form with the demand function and it accommodates both positive and negative marginal effects with respect to the determinants of the variance. A multi-step procedure is used to estimate the parameters of the model. Estimation of industry and time-varying employment efficiency is also considered. Employment efficiency is defined in terms of the distance from the employment frontier defined as minimum employment required to produce a given level of output. The empirical results show that the average employment efficiency is 92%.

Keywords: Labour demand; variance; efficiency; manufacturing industries; Zimbabwe (search for similar items in EconPapers)
JEL-codes: C23 C51 D24 E24 (search for similar items in EconPapers)
Pages: 23 pages
Date: 1998-11-06, Revised 2003-08-15
New Economics Papers: this item is included in nep-ltv
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Published in Journal of Development Economics, 2005, pages 527-551.

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:hastef:0277

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