The impact of ethnic fractionalisation on labor productivity: Does firm size matter?

Usman Khalid and Mohammad Amin

Journal of International Development, 2023, vol. 35, issue 7, 2213-2249

Abstract: Ethnic fractionalisation has both positive and negative consequences. We contend that the positive effects of skill complementarity in the production process apply to large firms. Because small businesses rely more on public goods and have less access to institutions, the negative effects of lower quality public goods and higher transaction costs have a greater impact on them. Consistent with this viewpoint, we find that larger firm size significantly mitigates the negative impact of higher ethnic fractionalisation on the level and growth rate of labor productivity in manufacturing firms across 84 developing countries. Evidence on the potential mechanisms is provided.

Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://doi.org/10.1002/jid.3771

Related works:
Working Paper: The Impact of Ethnic Fractionalization on Labor Productivity: Does Firm Size Matter? (2023)
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:wly:jintdv:v:35:y:2023:i:7:p:2213-2249

Access Statistics for this article

Journal of International Development is currently edited by Paul Mosley and Hazel Johnson

More articles in Journal of International Development from John Wiley & Sons, Ltd.
Bibliographic data for series maintained by Wiley Content Delivery ().