Productivity improvements in LIC manufacturing sectors

Project overview

Project lead: Atonu Rabbani, Innovations for Poverty Action

Start date: 1 June 2014

End date: 30 June 2017

Research Council project page

Manufacturing sectors in developing countries show a far greater dispersion in firm productivity and management practices than counterparts in high-income countries. Sustained increases in wages and employment creation depend on increases in productivity.

This project aimed to deepen understanding of the process of productivity improvement in manufacturing firms in low-income countries (LICs), and gain insights as to why productivity and innovation are lagging behind.

The research focused on the Bangladeshi Ready-made garment (RMG) sector, the largest source of urban employment in Bangladesh. The effects of a training programme developed and offered by Solutions for Management International (S4Mi), a not-for-profit consulting firm established as a part of DFID’s Responsible and Accountable Garment Sector (RAGS) programme, was studied.

S4Mi and the participating factories selected a single pilot production line on which to focus and a random selection of pilot lines will provide a valid comparison group prior to the factory-wide rollout. The team also combined extremely detailed productivity analysis with innovative survey and interview data. The survey and interview data provided a unique window onto the internal processes of change that accompany the transition.