This chapter reviews the literature on the theory of relational incentive contracts.  It motivates the discussion by the classic applications of relational contracts to the GM-Fisher Body relationship and the relationships between Japanese automobile manufacturers and their subcontractors.  It...

This paper studies the optimal allocation of coordination responsibilities in organizations where duplication of effort is a serious concern. The planner`s objective is to minimize a weighted average of the wage bill and the cost of delay. The paper provides conditions under which, in balanced...

Cobb Douglas production function parameters are not identified from cross-section variation when inputs are perfectly flexible and chosen optimally, and input prices are common to all firms. We consider the role of adjustment costs for inputs in identifying these parameters in this context. The...

Three dimensions of the performance of firms in Ghana’s manufacturing sector are investigated in this paper: their technology and the importance of technical and allocative efficiency. We show that the diversity of factor choices is not due to a non-homothetic technology....

Three dimensions of the performance of firms in Ghana’s manufacturing sector are investigated in this paper: their technology and the importance of technical and allocative efficiency. We show that the diversity of factor choices in not due to a non-homothetic technology. Observable...

It has been argued that Africa will not be able to export manufactures as it lacks the necessary skills. Without an ability to export there will only be an incentive to invest in the sector if domestic demand grows rapidly. Comparative data for four African countries - the Cameroon, Ghana, Kenya...

Schooling is typically found to be highly correlated with individual earnings in African countries.  However, African firm or sector level studies have failed to identify a similarly strong effect for average worker schooling levels on productivity.  This has been interpreted as evidence that...

This paper surveys the most popular parametric and semi-parametric estimators for Cobb-Douglas production functions arising from the econometric literature of the past two decades. We focus on the different approaches dealing with 'transmission bias' in firm-level studies, which arises from...

The labour productivity differentials between manufacturing firms in Ghana and South Korea exceed those implied by macro analysis.  Median value-added per employee is nearly 40 times higher in South Korea than Ghana.  The most important single factor in explaining this difference is the...

Suppose we observe a finite number of input decisions made by a firm, as well as the prices at which those inputs were acquired.  What conditions on the set of observations are necessary and sufficient for it to be consistent with a firm choosing inputs to maximize profit, subject to a...