Using the 2018 World Bank enterprise data, this study sought to establish whether the determinants of labor productivity in the Kenyan private service sector varied with the size of the firm. Unlike previous studies that just focus on the determinants of labor productivity among manufacturing firms; this study employed the two‐stage switching regressions model to correct for the firm‐size effect. The findings revealed that capital intensity, employee wage, high school education, and managers' experience impacted positively and significantly on labor productivity while tax burden and power outages significantly decreased labor productivity across all firms. The differences in the determinants of labor productivity across both firms were, however, found to be negligible and insignificant. With the political uncertainty and tax burden constraints perennially defining the Kenyan economy, the study recommended the provision of a favorable business environment and investment in human capital as key channels of optimizing service sector productivity. The selectivity variable was also significant across both firms, hence supporting the role of self‐selection in labor productivity studies. Correcting for the firm‐size effect was very crucial; something that has been largely ignored in previous studies on labor productivity.

中文翻译：

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肯尼亚中小型企业和大型私人服务公司的劳动生产率的决定因素

本研究使用2018年世界银行的企业数据，试图确定肯尼亚私营服务部门劳动生产率的决定因素是否随公司规模的变化而变化。与以往的研究仅关注制造企业中劳动生产率的决定因素不同；本研究采用两阶段转换回归模型来校正企业规模效应。调查结果表明，资本密集度，员工工资，高中教育程度和管理人员的经验对劳动生产率产生了积极而显着的影响，而税收负担和停电严重降低了所有公司的劳动生产率。然而，发现两家公司的劳动生产率决定因素之间的差异可以忽略不计，而且微不足道。由于政治不确定性和税收负担的​​限制常年影响着肯尼亚的经济，该研究建议提供有利的商业环境和对人力资本的投资，作为优化服务业生产率的关键渠道。选择性变量在两家公司中也很重要，因此支持了自我选择在劳动生产率研究中的作用。纠正企业规模效应至关重要。在先前有关劳动生产率的研究中，这一点被很大程度上忽略了。因此，支持了自我选择在劳动生产率研究中的作用。纠正企业规模效应至关重要。在先前有关劳动生产率的研究中，这一点被很大程度上忽略了。因此，支持了自我选择在劳动生产率研究中的作用。纠正企业规模效应至关重要。在先前有关劳动生产率的研究中，这一点被很大程度上忽略了。