An Empirical Investigation of the Effect of Manager’s Level of Education on Labour Productivity In the Manufacturing Sector in Uganda: 2006–2013

Abstract

This paper investigates the effect of education of firm managers on labour productivity
in Uganda’s manufacturing sector using enterprise survey data. Like in many SubSaharan economies, Uganda is grappling with labour productivity associated with
deficiencies and mismatch in skills, which limit the adaptation of new production
technologies. The human capital theory (HCT) and the endogenous growth theory
(EGT) underpinned this investigation. On the basis of a Cobb-Douglas function we
estimated a labour productivity equation. The paper found that attainment of higher
levels of education by firm managers improved labour productivity, and mean
productivity of individual workers at firm level. The strong linkage between managers’
education and labour productivity implies that the government should focus on
policies that improve higher education.
JEL Classification: J24