Good Business Practices Improve Productivity in Myanmar’s Manufacturing Sector

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We investigate the relationship between business practices and enterprise productivity using panel data with matched employer and employee information from Myanmar. The data show that micro, small, and medium-sized manufacturing enterprises in Myanmar typically adopt only a few modern business practices, and the persistence in the use is extremely low. Even so, we find a positive and economically important association between business practices and productivity. Specifically, the empirical results show that a one standard deviation difference in applied business practices (equivalent to applying an additional 4 to 5 of the 20 business practices in focus) is associated with an 8–10 per cent difference in labour productivity. Utilising the employer–employee information to estimate Mincer-type wage regressions, we find that workers receive about half to two-thirds of the productivity gain in higher wages. Overall, our findings support the notion of business practices as a production technology, and we find that workers and managers split the productivity gains evenly.

Original languageEnglish
JournalJournal of Development Studies
Issue number8
Pages (from-to)1258-1282
Number of pages25
Publication statusPublished - 2023

Bibliographical note

Publisher Copyright:
© 2023 UNU-WIDER. Published by Informa UK Limited, trading as Taylor & Francis Group.

    Research areas

  • Business practices, management, MSME, Myanmar, productivity

ID: 361593641