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Working Paper

Structural Transformation and Productivity Growth in Africa : Uganda in the 2000s

JOBS EMPLOYMENT GROWTH RATE MONETARY POLICY MOTIVATION PRODUCTIVITY LEVELS ECONOMIC GROWTH PRODUCTION AGGREGATE PRODUCTIVITY EMPLOYMENT SHARE INFORMAL SECTOR STRUCTURAL CHANGE INCOME PRODUCTIVE EMPLOYMENT SERVICE SECTOR EMPLOYMENT OPPORTUNITIES SERVICE INDUSTRIES TRADE BARRIERS AGE GROUP ELASTICITY OF DEMAND INFORMATION PRODUCTIVE INDUSTRIES EXPORTS ELASTICITY POLITICAL ECONOMY JOB‐CREATION WELFARE JOB AGGREGATE PRODUCTIVITY FIRM‐ SIZE AGE GROUPS DISTRIBUTION VARIABLES MARGINAL PRODUCTIVITY INPUTS RETAIL TRADE REAL WAGES PRODUCTIVITY INCREASE EMPLOYMENT SIZE FREE TRADE WAGE GROWTH JOB LOSSES TRENDS DRIVERS DEVELOPMENT PER CAPITA INCOMES LABOR MARKET PER CAPITA INCOME EMPLOYMENT LEVELS DEVELOPMENT ECONOMICS EXPORT GROWTH TELECOMMUNICATIONS AGE‐GROUPS FIRM LEVEL WORKER GROUP WORKER PRODUCTIVITY EXPORT LED GROWTH LABOR PRODUCTIVITY INDUSTRIALIZATION INCREASING RETURNS ORGANIZATIONS MANUFACTURING INDUSTRIES GROWTH RATE AGE GROUP OPEN ECONOMY LABOR LABOR PRODUCTIVITY TOTAL EMPLOYMENT EMPLOYMENT SHARE ECONOMIC RESEARCH TAXES UNEMPLOYMENT LABOR MARKET JOB‐DESTRUCTION PRODUCTIVITY GROWTH VALUE ADDED WORKERS PRODUCTIVITY LEVELS WAGES INTERNATIONAL TRADE REAL WAGE HIGH EMPLOYMENT VALUE COMPETITIVENESS CREDIT MACROECONOMICS PRODUCT DIFFERENTIATION AGE GROUPS COMPARATIVE ADVANTAGE OCCUPATION ECONOMY AGRICULTURE MANUFACTURING INDUSTRIES PRODUCT DIFFERENTIATION PRODUCTIVE FIRMS ECONOMIC RENTS EMPLOYMENT GROWTH JOB CREATION AGGREGATE EMPLOYMENT GROUP WORKER MEASUREMENT SHARES ECONOMIC THEORY TRADE LIBERALIZATION MANPOWER MANAGEMENT PRODUCTIVITY DECOMPOSITION MANUFACTURING INDUSTRIES TRADE GDP EXPORT‐LED GROWTH GOODS THEORY ECONOMIES OF SCALE ENTRY COSTS GROWTH RATE COMPARATIVE ADVANTAGE TRADE LIBERALIZATION PRODUCTIVITY GAP INCOME ELASTICITY OF DEMAND EMPLOYEE PRODUCT MARKETS ECONOMIES OF SCALE DEVELOPMENT ECONOMICS PRODUCTIVITY GAINS LABOUR AGGREGATE EMPLOYMENT UNSKILLED LABOR SELF‐EMPLOYMENT SMALL BUSINESSES PRICES LABOR REALLOCATION DEVELOPMENT POLICY MANUFACTURING INDUSTRIES EMPLOYEES
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World Bank, Washington, DC
Africa | Uganda
2015-12-18T22:30:19Z | 2015-12-18T22:30:19Z | 2015-12

Uganda’s economy underwent significant structural change in the 2000s whereby the share of non-tradable services in aggregate employment rose by about 7 percentage points at the expense of the production of tradable goods. The process also involved a 12-percentage-point shift in employment away from small and medium enterprises and larger firms in manufacturing and commercial agriculture mainly to microenterprises in retail trade. In addition, the sectoral reallocation of labor on these two dimensions coincided with significant growth in aggregate labor productivity. However, in and of itself, the same reallocation could only have held back, rather than aid, the observed productivity gains. This was because labor was more productive throughout the period in the tradable goods sector than in the non-tradable sector. Moreover, the effect on aggregate labor productivity of the reallocation of employment between the two sectors could only have been reinforced by the impacts on the same of the rise in the employment share of microenterprises. The effect was also strengthened by a parallel employment shift across the age distribution of enterprises that raised sharply the employment share of established firms at the expense of younger ones and startups. Not only was labor consistently less productive in microenterprises than in small and medium enterprises and larger enterprises across all industries throughout the period, it was also typically less productive in more established firms than in younger ones.

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