Abstract
Using firm-level data (2006 – 2023), this paper examines the interactions between export behavior and productivity among manufacturing firms in Tanzania. Specifically, the study tests the hypothesis that more productive firms self-select into export markets and benefit from global markets through learning-by-exporting and economies of scale. The study employs a two-step procedure to estimate firm-level productivity and compares exporting firms with non-exporting firms, controlling for observable heterogeneity. The findings of the study reveal a high and significant productivity premium of approximately 32 percent, which is consistent with the existing empirical literature. The results remain robust even when considering partial productivity (output and value added per worker). The implications are that low-income countries like Tanzania should promote manufacturing exports, liberalize their economies, and eliminate tariffs and non-tariff barriers to trade to enhance productivity and economic growth, both of which are key for structural transformation.
Recommended Citation
Hongoli, Josephat J. and Leyaro, Vincent
(2026)
"Exporting and Productivity: Evidence from Firm-Level Data in Tanzania,"
Tanzanian Economic Review: Vol. 15:
Iss.
2, Article 7.
Available at:
https://commons.udsm.ac.tz/ter/vol15/iss2/7