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Constrained Gazelles: High Potentials in West Africa’s Informal Economy

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Author Info

  • Grimm, Michael
  • Knorringa, Peter
  • Lay, Jann

Abstract

The informal sector is typically characterized as being very heterogeneous and possibly composed of two clearly distinct segments, sometimes called the lower and upper tiers. However, empirical evidence shows that even among lower tier entrepreneurs profitability can be quite high. We combine these findings and develop an innovative approach to identify what we call “constrained gazelles”, next to the well-known survivalists in the lower tier and growth-oriented top-performers in the upper tier. Our sample of informal entrepreneurs in seven West-African countries allows to link the relative size of these three groups to the structural and macroeconomic environment in these countries.

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Bibliographic Info

Article provided by Elsevier in its journal World Development.

Volume (Year): 40 (2012)
Issue (Month): 7 ()
Pages: 1352-1368

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Handle: RePEc:eee:wdevel:v:40:y:2012:i:7:p:1352-1368

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Web page: http://www.elsevier.com/locate/worlddev

Related research

Keywords: informality; entrepreneurship; capital; managerial ability; targeting; West-Africa;

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References

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Cited by:
  1. Verrest, Hebe, 2013. "Rethinking Microentrepreneurship and Business Development Programs: Vulnerability and Ambition in Low-income Urban Caribbean Households," World Development, Elsevier, vol. 47(C), pages 58-70.
  2. M. Arouri & A. Ben Youssef & Ceyhun Elgin, 2014. "Informal economy in Africa: Building human capital to set the Gazelles free," Working Papers 2014/04, Bogazici University, Department of Economics.

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