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Institutions and Job Growth in African Manufacturing: Does Employment Protection Regulation Matter? †

Institutions and Job Growth in African Manufacturing: Does Employment Protection Regulation... We use firm-level survey data from the manufacturing sector in 20 Sub-Saharan African (SSA) countries and Doing Business (DB) country indicators to explore the links between employment protection regulation (EPR) and firm job growth during the period 2003–07. We find that EPR is uncorrelated with job growth in the short run. In the long run, however, overall regulations as measured by DB scores are significantly adversely associated with job growth, while the evidence for a negative effect of EPR seems rather weak. Thus labour regulation reform might not lead to high employment payoffs in SSA; improving the overall investment climate should be the more immediate focus. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of African Economies Oxford University Press

Institutions and Job Growth in African Manufacturing: Does Employment Protection Regulation Matter? †

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References (11)

Publisher
Oxford University Press
Copyright
© The author 2013. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals.permissions@oup.com
Subject
Articles
ISSN
0963-8024
eISSN
1464-3723
DOI
10.1093/jae/ejt017
Publisher site
See Article on Publisher Site

Abstract

We use firm-level survey data from the manufacturing sector in 20 Sub-Saharan African (SSA) countries and Doing Business (DB) country indicators to explore the links between employment protection regulation (EPR) and firm job growth during the period 2003–07. We find that EPR is uncorrelated with job growth in the short run. In the long run, however, overall regulations as measured by DB scores are significantly adversely associated with job growth, while the evidence for a negative effect of EPR seems rather weak. Thus labour regulation reform might not lead to high employment payoffs in SSA; improving the overall investment climate should be the more immediate focus.

Journal

Journal of African EconomiesOxford University Press

Published: Aug 1, 2013

Keywords: JEL classification J21 J24 J31 O43 O55

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