Economics at your fingertips  

Why Does Economic Performance Differ between Domestic and Foreign-Owned Establishments? Evidence from Nigeria

Hideaki Goto and Nonso Okechukwu
Additional contact information
Hideaki Goto: International University of Japan
Nonso Okechukwu: Bureau of Public Enterprises

No EMS_2019_01, Working Papers from Research Institute, International University of Japan

Abstract: Diversifying its economy away from the oil industry and developing competitive nonagricultural industries are two of Nigeria's most important policy targets. However, the Nigerian economy faces significant challenges, such as educational attainment among workers, soundness of infrastructure, and access to finance. This study investigates how and to what extent these factors affect the output and productivity of domestic establishments (DEs) and foreignowned establishments (FOEs) in Nigeria. Further, it compares the economic performance of these two groups of establishments and analyzes the determinants of ownership differentials. First, the results show that FOEs significantly outperform DEs. Second, access to finance plays a key role, both in improving the economic performance of establishments (regardless of their ownership) and in explaining ownership differentials in economic performance. Third, it is implied that increasing educational attainment amongst workers could improve the performance of DEs by making it easier for them to employ skilled employees. In Nigeria, many reforms are under way under the Economic Recovery and Growth Plan, and they aim to develop infrastructure, strengthen the financial system, and improve human capital, to name but a few objectives; however, their rapid and complete implementation are urgently needed.

Keywords: ownership; manufacture; productivity; decomposition; Nigeria (search for similar items in EconPapers)
Pages: 24 pages
Date: 2019-01
New Economics Papers: this item is included in nep-afr and nep-fdg
References: Add references at CitEc

Downloads: (external link) First version, 2019 (application/pdf)

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:

Access Statistics for this paper

More papers in Working Papers from Research Institute, International University of Japan 777 Kokusai-cho, Minami Uonuma0-shi, Niigata 949-7277 JAPAN. Contact information at EDIRC.
Bibliographic data for series maintained by Kazumi Imai, Office of Academic Affairs ().

Page updated 2024-04-17
Handle: RePEc:iuj:wpaper:ems_2019_01