Empirical presentations: What do we know about Addis Ababa & other African cities?

Presenters

  • Simon Franklin, LSE

  • Patricia Jones, University of Oxford

  • Julia Bird, University of Oxford

Dr. Franklin started the session by presenting two of his most recent working papers on location, housing and labour markets in Addis Ababa. His first project, an RCT conducted in the job search market that subsidized a subset of the population’s travel expenses to and from the widely used job boards, aimed at researching how distance from the centre affected employment opportunities. In analysing the results, Dr. Franklin concluded that there was significant friction in the labour market such that subsidized individuals where more likely to both search for jobs and find better permanent employment. According to Dr. Franklin, there is therefore a role for policy to remove these frictions, for example by reducing transport costs, and implementing urban safety nets or welfare systems to improve access to labour markets. Lastly, Dr. Franklin presented his ongoing research project conducted around the government’s initiative to build low-income housing, allocated to the citizens of Addis Ababa through a lottery. In this project, Dr. Franklin aims to look at how being allocated such an apartment affects employment outcomes, health, savings and community risk-sharing.

Dr. Jones then presented her recent work in Tanzania on entrepreneurship and firm productivity. The goal of her work had been to identify which types of firms created the most productive jobs, as job creation in many African countries is not necessarily correlated with small, entrepreneurial firms, such as the case in most OECD countries. Dr. Jones was able to identify a number of characteristics that were correlated with increased productivity and concluded that creating more productive firms it was important for having functioning transport networks.

Lastly, Julia Bird presented an ongoing study on path dependence and infrastructure in African cities. The study researched the location of firms and the elasticity of such locations, in order to explore reasons for why productivity in many African cities tends to be very low. Julia explained how the motivation of the study was to better understand the effects of urban transport infrastructure on the location of people and business as well as how policies can help make cities work. The study exploited a large urban transport infrastructure investment in Kampala, where the predicted effect of building such a large highway was to increase clustering of businesses as well as a shifting of tradable industries closer to the highway. Julia Bird concluded her presentation by explaining the extensive firm data set that the project would be analysing and asking the audience to stay tuned for upcoming results.

Summary written by Amanda Jinhage, Policy Economist