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Factor Proportions, Openness and Factor Prices in Kenya 1965-2000

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  • Arne Bigsten
  • Dick Durevall

Abstract

This study analyses how changes in factor abundance and openness have affected relative factor prices in Kenya since 1965, using cointegration analysis and error correction models of relative factor prices. We find that factor proportions determined relative factor prices in the long run, while openness, measured by three different proxies, possibly had a short run effect on relative factor returns. The only deviation from this pattern occurred during the latter half of the 1990s when there was rapid wage growth, mainly due to labour market deregulation.

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  • Arne Bigsten & Dick Durevall, 2008. "Factor Proportions, Openness and Factor Prices in Kenya 1965-2000," Journal of Development Studies, Taylor & Francis Journals, vol. 44(2), pages 289-310.
    • Handle: RePEc:taf:jdevst:v:44:y:2008:i:2:p:289-310
    DOI: 10.1080/00220380701789976
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    Cited by:

    1. Bigsten, Arne, 2016. "The Development of Development Economics," Working Papers in Economics 653, University of Gothenburg, Department of Economics, revised Mar 2017.
    2. Arne Bigsten & Damiano Kulundu Manda & Germano Mwabu & Anthony Wambugu, 2014. "Incomes, Inequality, and Poverty in Kenya: A Long-Term Perspective," WIDER Working Paper Series wp-2014-126, World Institute for Development Economic Research (UNU-WIDER).
    3. Arne Bigsten & Måns Söderbom, 2010. "African Firms in the Global Economy," Review of Market Integration, India Development Foundation, vol. 2(2-3), pages 229-253, August.
    4. Bigsten, Arne & Manda, Damiano Kulundu & Mwabu, Germano & Wambugu, Anthony, 2014. "Incomes, inequality, and poverty in Kenya: A long-term perspective," WIDER Working Paper Series 126, World Institute for Development Economic Research (UNU-WIDER).

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