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

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  • Louise Fox
  • Ana Maria Oviedo

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. Copyright 2013 , Oxford University Press.

Suggested Citation

  • Louise Fox & Ana Maria Oviedo, 2013. "Institutions and Job Growth in African Manufacturing: Does Employment Protection Regulation Matter?," Journal of African Economies, Centre for the Study of African Economies, vol. 22(4), pages 616-650, August.
    • Handle: RePEc:oup:jafrec:v:22:y:2013:i:4:p:616-650
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    File URL: http://hdl.handle.net/10.1093/jae/ejt017
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    Cited by:

    1. Ofori, Isaac K., 2024. "Frontier Technology Readiness, Democracy, and Income Inequality in Africa," EconStor Preprints 298788, ZBW - Leibniz Information Centre for Economics.
    2. Stephen Golub & Aly Mbaye & Hanyu Chwe, 2015. "Labor Market Regulations in Sub-Saharan Africa, With a Focus on Senegal," Working Papers 201505, University of Cape Town, Development Policy Research Unit.
    3. Augustin Kwasi Fosu & Abdul Fatawu Abass, 2019. "Domestic Credit and Export Diversification: Africa from a Global Perspective," Journal of African Business, Taylor & Francis Journals, vol. 20(2), pages 160-179, April.
    4. Aalia Cassim & Kezia Lilenstein & Morne Oosthuizen & Francois Steenkamp, 2016. "Informality and Inclusive Growth in Sub-Saharan Africa," Working Papers 201602, University of Cape Town, Development Policy Research Unit.
    5. Golub, Stephen & Hayat, Faraz, 2014. "Employment, unemployment, and underemployment in Africa," WIDER Working Paper Series 014, World Institute for Development Economic Research (UNU-WIDER).
    6. Augustin Kwasi Fosu, 2018. "Economic Structure, Growth, and Evolution of Inequality and Poverty in Africa: An Overview," Journal of African Economies, Centre for the Study of African Economies, vol. 27(1), pages 1-9.
    7. Stephen Golub & Faraz Hayat, 2014. "Employment, Unemployment, and Underemployment in Africa," WIDER Working Paper Series wp-2014-014, World Institute for Development Economic Research (UNU-WIDER).
    8. Keraga, Mezid N. & Stephan, Andreas, 2023. "Does innovation stimulate employment in Africa? New firm-level evidence from the Worldbank Enterprise Survey," Working Paper Series in Economics and Institutions of Innovation 494, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.

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