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The Effect of Ethnic Violence on an Export-Oriented Industry

Christopher Ksoll (), Rocco Macchiavello () and Ameet Morjaria

No 8074, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper investigates the effects of ethnic violence on export-oriented firms and their workers. Following the disputed 2007 Kenyan presidential election, export volumes of flower firms affected by the ensuing violence dropped by 38 percent and worker absence exceeded 50 percent. Large firms and firms with stable contractual relationships in export markets registered smaller proportional losses and had fewer workers absent. Model calibrations indicate that, to induce workers to come and work over-time, operating costs, on average, increased by 16 percent. For the marginal worker, the cost of going to work exceeded the average weekly income by 320 percent.

Keywords: ethnic Violence; exports; firm heterogeneity; non-traditional agriculture (search for similar items in EconPapers)
JEL-codes: D74 F14 O13 Q13 (search for similar items in EconPapers)
Date: 2010-10
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