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Article
Real Wages and Labour Productivity in Tanzania: How Do They Link?
Journal of African Studies and Development (2015)
  • Abel A Kinyondo, University of Dar es salaam
  • Rizwanul Islam
  • Joseph Nganga
Abstract
Using data from national level surveys, the present paper undertakes an empirical analysis of the linkage between labour productivity and real wages in Tanzania. After making tabular presentations of growth in labour productivity and real wages by industry and sector (public and private), regression analysis is undertaken to examine the factors that influence incomes. Granger causality test is applied to explain the nature of the relationship between rel wages and productivity for manufacturing industries. The paper finds no clear pattern in link between real wages and productivity. Real incomes in the private sector have registered negative growth while the opposite has been the case in the public sector. In addition to education, age, occupation, and location are found to be important determinants of income. Real wages have significant impact on productivity in the manufacturing sector, thus lending support to the efficiency wage hypothesis.
Publication Date
Spring March 24, 2015
Citation Information
Abel A Kinyondo, Rizwanul Islam and Joseph Nganga. "Real Wages and Labour Productivity in Tanzania: How Do They Link?" Journal of African Studies and Development Vol. 7 Iss. 3 (2015)
Available at: http://works.bepress.com/abel_kinyondo/10/