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Title: Labour productivity, exports and skills formation: Comparing foreign and local firms in Kenyan manufacturing
Authors: Gachino, G. 
Issue Date: 2013
Publisher: African Books Collective
Journal: Creating Systems of Innovation in Africa: Country Case Studies 
Abstract: This paper uses firm-level panel data from Kenyan manufacturing industryto compare labour productivity, export and skills formation betweenforeign and local firms. Given the superior productive capabilities andmarket access of multinational firms, foreign direct investment (FDI) isconsidered to enjoy greater potential to generate labour productivity,manufactured exports and skilled labour than local firms in pooreconomies. The paper also examines how FDI aff ects labour productivity,export and skill formation as one of the determinants, among others. Theresults generated show that, although local firms generally fared betterthan foreign firms involving the growth of labour productivity, exports andskilled labour, foreign firms continued to enjoy higher shares. FDI had apositive relationship with labour productivity, exports and skill formation.Overall, it can be claimed that FDI has generally impacted positively onKenyan manufacturing labour productivity, exports and skilled labour.The positive results of positive impact of FDI have been obtained despitelow levels of FDI. The implication is that FDI should be promoted but intandem with domestic industrial policies which ensure enhanced learning,capability development and innovation. © 2012 Africa Institute of South Africa.
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