Drivers of manufacturing firms’ productivity: a micro-perspective to industrialization in Nigeria

Musa Abdu, Adamu Jibir (), Salihu Abdullahi and Aisha Adamu Hassan ()
Additional contact information
Adamu Jibir: Gombe State University
Aisha Adamu Hassan: Gombe State University

SN Business & Economics, 2021, vol. 1, issue 2, 1-17

Abstract: Abstract A significant body of literature suggests that the manufacturing sector has a strategic role in the economic development of a country. To develop a sound, inclusive, sustained and innovative manufacturing sector, it is, therefore, essential to study the drivers of productivity among firms operating in the sector. Thus, this study investigates the major determinants of manufacturing firms’ productivity in Nigeria as a micro-perspective to industrialization. To realize its objective, the study uses simultaneous technique of stochastic frontier to analyse 2007–2014 unbalanced panel firm-level dataset. Our findings reveal that manufacturing firms in Nigeria are heavily labour intensive and face increasing returns to scale. The results further disclose that while average labour costs or earnings and frequency of power outage exert negative effects on the firms’ productivity or efficiency level, micro and small firms are found to more efficient than large manufacturing firms. Also, exporting manufacturing firms are more efficient than their non-exporting counterparts. Policy implications of the study are that to formulate pragmatic industrialization policy, it has to be micro-founded in nature and such a policy should encourage exportation, provision of stable power supply and pay special attention to large-scale manufacturing firms.

Keywords: Efficiency; Industrialization; Manufacturing firms; Stochastic frontier analysis (search for similar items in EconPapers)
JEL-codes: C10 D61 L60 O14 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1007/s43546-020-00026-5 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:snbeco:v:1:y:2021:i:2:d:10.1007_s43546-020-00026-5

Ordering information: This journal article can be ordered from
https://www.springer.com/journal/43546

DOI: 10.1007/s43546-020-00026-5

Access Statistics for this article

SN Business & Economics is currently edited by Gino D'Oca

More articles in SN Business & Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().