with Morgan Hardy
The Government of Ethiopia has embarked on an ambitious industrialization strategy based on the creation of special economic zones as centers of export-oriented light manufacturing. The flagship industrial park of this strategy is located in the city of Hawassa, in Ethiopia’s Southern Nations, Nationalities and People’s (SNNP) Region. At full capacity, the Hawassa Industrial Park will provide employment to 60,000 workers from the wider region, most of whom will be women aged between 18 and 35. You can learn more about Hawssa Industrial Park in this Bloomberg Businessweek feature story.
Relatively little is known about the impact of such industrial employment opportunities on the economic, physical, and social well-being of workers and the largely rural, agricultural communities from which they are recruited. This project uses a large-scale cluster-randomized control trials to evaluate these impacts.
For the Ethiopian government, the Hawassa Industrial Park serves as a blueprint for the development of future parks in the country. Accordingly, we hope that the findings of our work can inform future industrial development policy in the country.
Given the tight integration with existing administrative data, we also hope to provide more immediate feedback loops that can inform Ethiopian policymakers at the local and federal level. Beyond Ethiopia, we hope that our evaluation can shed light on the implications of large-scale, location-specific development projects such as growth corridors, growth poles, industrial parks, on individuals and local communities.
Fully quantifying the impacts of such programs is often challenging because generating counter-factual scenarios for such investments is complex, and full estimation of impact also requires an understanding of general equilibrium effects in various markets at the same time. With our project, we hope to make a step towards this understanding and thus inform wider development policy as well.
Methodologically, this study aims to use the expansion of hiring for the park through a centralized, government-led system that integrates recruitment, registration, grading, and training of future workers.
Our research design builds on this centralized system: We work with local partners to randomly assign communities to an already-planned expansion of recruitment for the park. We will complement existing administrative data with detailed primary household survey data that we are currently collecting.
We are currently in the field for our baseline data collection.
We are grateful for funding from the International Growth Centre, New York University Abu Dhabi, the Private Enterprise Development in Low Income Countries (PEDL) research initiative of the Centre for Economic Policy Research (CEPR) and the UK Department for International Development (DFID), the World Bank’s ieConnect for Impact program, and the World Bank’s “More, Better, and More Inclusive Jobs: Preparing for Succesful Industrialization in Ethiopia” program (funded by DFID).