Good business practices improve productivity in Myanmar’s manufacturing sector: Evidence from two matched employer–employee surveys

Falco, Paolo; Hansen, Henrik; Rand, John; Tarp, Finn; Trifković, Neda

doi:10.35188/unu-wider/2021/983-9

Cited by 1 publication

(4 citation statements)

References 37 publications

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“…We also control for management quality measured as a number of beneficial business practices applied by the enterprise due to its established importance for overall firm performance (Falco et al, 2021;Hansen, Rand, Tarp, et al, 2021;McKenzie & Woodruff, 2017). We expect that otherwise better-performing firms will invest more in skills development of their works.…”

Section: Empirical Strategymentioning

confidence: 99%

“…We control for the size of enterprise (both in terms of capital and labour) as it has been established in the literature that firm size is one of the main determinants of worker wages (Schmidt & Zimmermann, 1991; Troske, 1999). We also control for management quality measured as a number of beneficial business practices applied by the enterprise due to its established importance for overall firm performance (Falco et al, 2021; Hansen, Rand, Tarp, et al, 2021; McKenzie & Woodruff, 2017). We expect that otherwise better‐performing firms will invest more in skills development of their works.…”

Section: Empirical Strategymentioning

confidence: 99%

“…As educational and training systems produce a shortage of qualified workers, the enterprise investment in training is expected to play an important role in the structural transformation process, yet there has been scant, if any, research into the effect of training in Myanmar. The empirical research on SMEs in Myanmar has until now investigated industrial agglomeration, returns to export, formalization, business practices, and access to finance (Danquah & Sen, 2021; Falco et al, 2021; Hansen, Rand, Tarp, et al, 2021; Hansen, Rand, & Trifković, 2021; Min & Kudo, 2012; Mueller et al, 2020; Rand et al, 2019; Tanaka, 2019).…”

Section: Introductionmentioning

confidence: 99%

“…The empirical research on SMEs in Myanmar has until now investigated industrial agglomeration, returns to export, formalization, business practices, and access to finance (Danquah & Sen, 2021;Falco et al, 2021;Hansen, Rand, Tarp, et al, 2021;Hansen, Rand, & Trifković, 2021;Min & Kudo, 2012;Mueller et al, 2020;Rand et al, 2019;Tanaka, 2019).…”

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confidence: 99%

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Wage returns to workplace training in Myanmar

Hansen

Kanayade

Rand

et al. 2023

Development Policy Review

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Motivation: Workplace training is an indispensable part of workforce skill development, but it is often provided irregularly and selectively in private enterprises. This is a missed opportunity given its potential to contribute to employee wellbeing and human capital development, and to boost firm performance. Purpose: We examine workplace training provision and private returns to training in Myanmar, a country with a severely constrained formal educational system and underperforming private sector. Methods and approach: We use linked employer-worker panel data from micro, small, and medium manufacturing enterprises in Myanmar. Our regression framework includes controls for production factors and other standard enterprise and owner characteristics, including employee and owner skills, and unobservable time-invariant employee and firm heterogeneity. Findings: First, we document a low prevalence of training in manufacturing enterprises. Second, we find a wage premium associated with training of about 8%. Third, we show that workplace training is offered selectively to workers and how, when this is the case, the wage gap between trained and untrained workers surpasses 10%. Fourth, we find that prior training (in other firms) or certified training do not contribute to higher wages, indicating that training is largely firm-specific. Finally, we find that the wage returns to training are particularly high for women and among the least educated workers. Policy implications: Considering the wage return as a lower bound of productivity gains from training, our results suggest that government support of workplace training programmes in private enterprises could help increase performance of the manufacturing sector in Myanmar. High returns to training among the least educated workers indicate that training could improve the overall income distribution in the economy.

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Section: Empirical Strategymentioning

confidence: 99%