http://repub.eur.nl/res/aut/21908/ List of Publications en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/21650/ 2009-03-01T00:00:00Z This paper analyzes the risk of exit for privately-owned manufacturing establishments in a small African economy. It shows that changes in the structure of ownership following an economic reform have important implications on stablishment survival. The risk of exit is lower for establishments that belong to multi-unit firms as compared to single-unit establishments suggesting the presence of information and risk sharing mechanisms within a group. Although female-owned businesses tend to be smaller in size, they have better chances of survival than male-owned establishments. The probability of exit also declines significantly in establishment size and productivity. http://repub.eur.nl/res/pub/18340/ 2009-01-01T00:00:00Z The Dynamics of Job Creation and Job Destruction: Is Sub-Saharan Africa Different? This paper analyzes the creation, destruction and reallocation of jobs in order to understand the micro-dynamics of aggregate employment change in African manufacturing. The nature and magnitude of gross job flows are examined using a unique panel data of Ethiopian manufacturing establishments over the period 1996-2007. We also assess the relative importance of firm demographics, industry effects and business cycles for job flows. The rates and patterns of job creation and destruction in our sample are comparable to the findings from developed and emerging economies suggesting that African firms adjust their labor force in a manner broadly similar to firms elsewhere and that African labor markets are not uniquely restrictive in terms of undermining job reallocation across firms. We also find, as in many other countries, that job reallocation is relatively higher in industries dominated by smaller and younger establishments. However, unlike other regions, job reallocation in our sample is pro-cyclical and its variation across industries bears little similarity to the patterns found in other developed and emerging economies. Small firms in Africa create jobs mainly at the point of market-entry and play a limited role in terms of contributing to manufacturing employment through post-entry expansion. http://repub.eur.nl/res/pub/32611/ 2007-01-01T00:00:00Z http://repub.eur.nl/res/pub/19185/ 2006-05-01T00:00:00Z http://repub.eur.nl/res/pub/18759/ 2006-01-01T00:00:00Z Judging by the provisions of its investment code and the apparent stability of the macro-economy, Ethiopia seems to offer a favourable investment climate for the private sector. However, Ethiopian manufacturing has experienced a declining rate of investment since the mid 1990s. Like other Sub-Saharan African countries, more than half of manufacturing firms in Ethiopia have zero investment episodes; episodes that have become more persistent over time. This contrasts badly with high average profit rates in African manufacturing relative to average profit rates in OECD countries. Rather than being smooth and continuous, firm level investment in Africa is less frequent and lumpy. While this pattern of capital adjustment is not unique to Africa, the discontinuity and lumpiness is starker than what is observed in developed countries. The evidence in this paper suggests that such discontinuity and the lacklustre investment performance have more to do with uncertainty and irreversibility. The paper shows that uncertainty, proxied by the volatility of profits, undermines mainly the likelihood rather than the rate of investment. However, the possibility to reverse investment decisions, captured by the scope of the second hand market for machinery, significantly increases the rate of investment. http://repub.eur.nl/res/pub/19171/ 2005-09-01T00:00:00Z http://repub.eur.nl/res/pub/19100/ 2002-01-01T00:00:00Z