Business Management Review - latest Issue
Volume 11, Issue 2, 2007
Source: Business Management Review 11, pp 1 –27 (2007)More Less
This study focuses on testing the hypothesis that application of ICT at firm level and trade facilitation policies has a causal impact on the quality and quantity of manufactured exports, productivity and investment. The study findings based on production function estimates show a strong positive correlation between unobserved time invariant firm characteristics with the level of application of ICT, exports and productivity performance. Following the estimates based on GMM, when we control for firm fixed effects, the results suggest a strong positive correlation between unobserved firm fixed effects and both ICT and trade facilitation. Further findings of the study are that trade facilitation policies measured by government policies on prices, facilities on access to imported raw materials, preferential trade access and overall trade policy changes have significant influences on firm level performance of exports and productivity. Therefore, the potential missing links for the workability of trade facilitation and productivity are access to credit, skilled labour, demand deficiency and trade policy certainty. To halt stagnation of Tanzanian manufacturing exports and growth, via trade facilitation such as firm level factors, must be addressed.
Author Waswa Katono IssacSource: Business Management Review 11, pp 28 –53 (2007)More Less
Many Small and Medium Enterprises (SMEs) in Uganda have not utilized the opportunities presented by AGOA. The objective of this study was to examine the constraints that hinder these firms from utilizing these opportunities. Specifically the study examined the macro constraints facing these firms, with a view to finding solutions to them. A literature review was carried out to identify challenges to SMEs participation in AGOA., followed by a triangulation technique in which a qualitative study (Focus Discussion Group) involving key stakeholders in this business was done to further identity these constraints and their underlying dimensions. Instrument development was next, followed by a reliability analysis in which the psychometric properties of the instrument were assessed on the basis of Cronbachs alpha. A quantitative study was then done by administering the refined questionnaire to a group of exporters. Factor Analysis by promax (oblimin ) rotation revealed six oblique factors identifying that the most important constraints facing Ugandan SMEs are Lack of middle managers, infrastructure, technology, marketing, inadequate export credit and governance issues. The study calls for technological transfer from the developed countries to the Less Developed Countries (LDCs) in addition to addressing the other barriers. There is also a need for exporters to develop better marketing skills through training .The study implores the government to put policies in place that will enhance the development of SMEs.
Do foreign-owned firms pay higher wages than locally-owned firms? Evidence from Tanzania s manufacturing sectorAuthor Beatrice Kalinda MkendaSource: Business Management Review 11, pp 54 –71 (2007)More Less
This paper employs data from Tanzanias manufacturing sector to examine the impact of foreign-owned firms on wages. It finds that the sampled workers from foreign-owned and exporting firms have relatively higher median and mean monthly wages than workers from locally-owned firms. Using regression analysis to examine the impact of foreign-owned firms on earnings, as well as the effect of globalisation on earnings, the paper finds a positive and significant effect of foreign ownership and globalisation on the earnings of workers. The regression analysis also includes common human capital variables, and the results are not surprising; age, experience and education positively affect earnings. Other variables included in the regression are location, size and gender, and the findings are that firms that are located outside Dar es Salaam pay less than those based in the commercial capital, larger firms pay higher wages than smaller firms, and female workers face wage discrimination.
Author Benjamin MutagwabaSource: Business Management Review 11, pp 72 –91 (2007)More Less
The objective of this paper is to evaluate the entire effect of the linkage between rural grassroots tomato producers and urban food processors. Based on that, the study determined the income inequality within and the two groups as a whole. Specifically, the study evaluated the nature and structure of the linkage, and established income inequality by considering the groups individually, as well as combining both groups. By the use of network analysis, the linkage has been established to be in form of product flow, information and knowledge transfer, capital flow (credit/finance) and through forms of contact and social relations. However in as much as the linkage reduces income inequality within the groups, thus alleviating poverty, as measured by Theil Index, inequality in both groups considered as a whole increases. The preliminary conclusion is that this could be a result of unfair prices paid by processors to farmers, or due to adjustment programmes that disfavour the rural area setting. The study therefore recommends that concerted efforts should be made to support farmers by investing in rural infrastructure, and assistant in farming and marketing practices.
Author Pantaleo J. KessySource: Business Management Review 11, pp 92 –117 (2007)More Less
Tanzania, like many other countries, actively intervenes in the foreign exchange market when necessary to help stabilize the exchange rate. What is not clear though is whether or not such interventions have had any significant impact on exchange rate variability. This paper investigates the impact of central bank intervention on the level and volatility of the exchange rate in Tanzania. The paper first endeavours to test whether or not foreign exchange market interventions by the Bank of Tanzania are sterilized. This question is addressed by running a standard regression on base money to see if the changes in the Net Foreign Assets of the Bank of Tanzania systematically affect the monetary base. The results indicate that there is some evidence of sterilization of foreign exchange market intervention in Tanzania. We then test the effects of sterilized foreign exchange market intervention on exchange rate level and volatility. Overall the empirical evidence suggests that foreign exchange intervention in Tanzania may have not been effective in reducing exchange rate fluctuations. In the light of these findings, we argue that the central Bank of Tanzania may need to reassess its intervention strategy, particularly the timing and the magnitude of the interventions.