Advanced Search
MyIDEAS: Login to save this paper or follow this series

The Maghribi industrialists: contract enforcement in the Moroccan industry, 1956-82

Contents:

Author Info

  • Romain Ferrali
Registered author(s):

    Abstract

    Original oral history data shows that during the import-substituting industrialisation, state capitalist period delimited by the independence in 1956 and the structural adjustment program in 1982, Moroccan manufacturers were operating in an environment characterised by a high risk of contractual breach, and by long-term, face-to-face relationships with few trade partners. The judicial system was seldom used to enforce contracts, because it was dysfunctional, and would break up a valuable relationship. To avoid contractual problems, entrepreneurs were largely relying on their acquaintances: economic life was embedded in social life. Social capital was derived from the business network and social connections rather than from connections with the state, kin-based and ethno-geographic groups. Private enforcement does not work as the Maghribi traders suggest. It is a way of screening customers and suppliers based on on-demand, reciprocal exchange of imprecise information, rather than a way of inflicting collective punishment. Its efficiency depends on the structure of the business network and on the individual social capital that agents hold within this structure. The institutional environment deteriorated after the period, because an increased number of players disrupted the structure of the business network and decreased the efficiency of private enforcement.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://eprints.lse.ac.uk/45680/
    Download Restriction: no

    Bibliographic Info

    Paper provided by London School of Economics and Political Science, Department of Economic History in its series Economic History Working Papers with number 45680.

    as in new window
    Length: 71 pages
    Date of creation: Aug 2012
    Date of revision:
    Handle: RePEc:ehl:wpaper:45680

    Contact details of provider:
    Postal: LSE, Dept. of Economic History Houghton Street London, WC2A 2AE, U.K.
    Phone: +44 (0) 20 7955 7084
    Web page: http://www.lse.ac.uk/economicHistory/
    More information through EDIRC

    Related research

    Keywords:

    Find related papers by JEL classification:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Michi Kandori, 2010. "Social Norms and Community Enforcement," Levine's Working Paper Archive 630, David K. Levine.
    2. Jeremy Edwards & Sheilagh Ogilvie, 2012. "Contract enforcement, institutions, and social capital: the Maghribi traders reappraised," Economic History Review, Economic History Society, vol. 65(2), pages 421-444, 05.
    3. John Shuhe Li, 2003. "Relation-based versus Rule-based Governance: an Explanation of the East Asian Miracle and Asian Crisis," Review of International Economics, Wiley Blackwell, vol. 11(4), pages 651-673, 09.
    4. Abhijit V. Banerjee & Esther Duflo, 2000. "Reputation Effects And The Limits Of Contracting: A Study Of The Indian Software Industry," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 989-1017, August.
    5. Hart, Oliver, 1995. "Firms, Contracts, and Financial Structure," OUP Catalogue, Oxford University Press, number 9780198288817, October.
    6. Marcel Fafchamps, 2004. "Market Institutions in Sub-Saharan Africa: Theory and Evidence," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262062364, December.
    7. Woodruff, Christopher, 1998. "Contract enforcement and trade liberalization in Mexico's footwear industry," World Development, Elsevier, vol. 26(6), pages 979-991, June.
    8. Arne Bigsten & Paul Collier & Stefan Dercon & Marcel Fafchamps & Bernard Gauthier & Jan Willem Gunning & Abena Oduro & Remco Oostendorp & Cathy Patillo & M´┐Żns Soderbom & Francis Teal & Albert Zeufac, 2000. "Contract flexibility and dispute resolution in African manufacturing," Journal of Development Studies, Taylor & Francis Journals, vol. 36(4), pages 1-37.
    9. Beckmann, Volker & Boger, Silke, 2003. "Courts And Contract Enforcement In Transition Agriculture: Theory And Evidence From Poland," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25878, International Association of Agricultural Economists.
    10. Tetsuji Okazaki, 2004. "The Role of the Merchant Coalition in Pre-modern Japanese Economic Development: An Historical Institutional Analysis," CIRJE F-Series CIRJE-F-268, CIRJE, Faculty of Economics, University of Tokyo.
    11. Fudenberg, Drew & Maskin, Eric, 1986. "The Folk Theorem in Repeated Games with Discounting or with Incomplete Information," Econometrica, Econometric Society, vol. 54(3), pages 533-54, May.
    12. Williamson, Oliver E, 1981. "The Modern Corporation: Origins, Evolution, Attributes," Journal of Economic Literature, American Economic Association, vol. 19(4), pages 1537-68, December.
    13. Paul R. Milgrom & Douglass C. North & Barry R. Weingast, 1990. "The Role Of Institutions In The Revival Of Trade: The Law Merchant, Private Judges, And The Champagne Fairs," Economics and Politics, Wiley Blackwell, vol. 2(1), pages 1-23, 03.
    14. Jeremy Edwards & Sheilagh Ogilvie, 2011. "What Lessons for Economic Development Can We Draw from the Champagne Fairs?," CESifo Working Paper Series 3438, CESifo Group Munich.
    15. Telser, L G, 1980. "A Theory of Self-enforcing Agreements," The Journal of Business, University of Chicago Press, vol. 53(1), pages 27-44, January.
    16. Guanghua Yu & Hao Zhang, 2008. "Adaptive Efficiency and Financial Development in China: The Role of Contracts and Contractual Enforcement," Journal of International Economic Law, Oxford University Press, vol. 11(2), pages 459-494, June.
    17. Fafchamps, Marcel, 1996. "The enforcement of commercial contracts in Ghana," World Development, Elsevier, vol. 24(3), pages 427-448, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:ehl:wpaper:45680. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lucy Ayre on behalf of EH Dept.).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.