Tanzania: Pilot Rural Investment Climate Assessment. Stimulating Nonfarm Microenterprise Growth
AbstractTanzania’s Pilot Rural Investment Climate Assessment (RICA) measures the economic environment of non-farm entrepreneurs. The pilot assessment has three key objectives: it aims to better understand the rural non-farm economy in Tanzania, shed light on rural enterprise dynamics and business constraints, and reflect on areas where government policies are readily directed to help promote rural non-farm enterprise activity. The RICA is based on an analysis of a unique survey data set collected by the National Bureau of Statistics (NBS) during January and March 2005, covering enterprises, households, and communities in all seven geographical zones of the country. Selected findings are: (i) Non-farm activities are an important source of income for approximately 1.4 million rural households, (ii) Tanzanian rural non-farm enterprises differ from their urban counterparts, (iii) the predominant entrepreneurial activity is trading, (iv) labor productivity is typically low, (v) formal enterprises have higher levels of labor productivity than informal, (vi) the rate of new firm creation appears to be lower than in other African countries, and (vii) only a minority of enterprises propels employment growth. The pilot approach call for a careful evaluation of the following recommendations, which presented to stimulate dialogue and future analysis: (i) favorable policies and investments for agriculture play a big role for rural enterprises, (ii) maintaining favorable internal trade policies may therefore be of utmost importance in determining enterprise performance, (iii) microcredit and savings may offer a tool for promoting rural non-farm activity in buoyant rural markets, (iv) easing bottlenecks in rural infrastructure is important, (v) exploring options for better telecommunications via private sector cell phone nodes may be an attractive policy option to stimulate entrepreneurial activities, (vi) continuation of business registration reform and effective implementation at the local level remains a high priority, and (vii) future analysis should address knowledge gaps.
Download InfoIf 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.
Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 24824.
Date of creation: 27 Jun 2007
Date of revision:
Tanzania; rural labor markets; enterprise performance; informal sector;
Find related papers by JEL classification:
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
- J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
- O55 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Africa
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.:
- Rosegrant, Mark W. & Hazell, Peter B. R., 2001. "Transforming the rural Asian economy," 2020 vision briefs 69, International Food Policy Research Institute (IFPRI).
- Arne Bigsten & Peter Kimuyu & Karl Lundvall, 2004. "What to Do with the Informal Sector?," Development Policy Review, Overseas Development Institute, vol. 22(6), pages 701-715, November.
- Bigsten, Arne & Soderbom, Mans, 2005.
"What have we learned from a decade of manufacturing enterprise surveys in Africa ?,"
Policy Research Working Paper Series
3798, The World Bank.
- Arne Bigsten & Mans Söderbom, 2006. "What Have We Learned from a Decade of Manufacturing Enterprise Surveys in Africa?," World Bank Research Observer, World Bank Group, vol. 21(2), pages 241-265.
- Dollar, David & Hallward-Driemeier, Mary & Mengistae, Taye, 2005. "Investment Climate and Firm Performance in Developing Economies," Economic Development and Cultural Change, University of Chicago Press, vol. 54(1), pages 1-31, October.
- McPherson, Michael A., 1996. "Growth of micro and small enterprises in southern Africa," Journal of Development Economics, Elsevier, vol. 48(2), pages 253-277, March.
- Richard Tiffin & Xavier Irz, 2006. "Is agriculture the engine of growth?," Agricultural Economics, International Association of Agricultural Economists, vol. 35(1), pages 79-89, 07.
- Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-70, May.
- Sleuwaegen, Leo & Goedhuys, Micheline, 2002. "Growth of firms in developing countries, evidence from Cote d'Ivoire," Journal of Development Economics, Elsevier, vol. 68(1), pages 117-135, June.
- Mead, Donald C. & Liedholm, Carl, 1998. "The dynamics of micro and small enterprises in developing countries," World Development, Elsevier, vol. 26(1), pages 61-74, January.
- Ellis, Frank & Mdoe, Ntengua, 2003. "Livelihoods and Rural Poverty Reduction in Tanzania," World Development, Elsevier, vol. 31(8), pages 1367-1384, August.
- Lisa Daniels, 2003. "Factors that influence the expansion of the microenterprise sector: results from three national surveys in Zimbabwe," Journal of International Development, John Wiley & Sons, Ltd., vol. 15(6), pages 675-692.
- Barrett, C. B. & Reardon, T. & Webb, P., 2001. "Nonfarm income diversification and household livelihood strategies in rural Africa: concepts, dynamics, and policy implications," Food Policy, Elsevier, vol. 26(4), pages 315-331, August.
- Lanjouw, Peter & Quizon, Jaime & Sparrow, Robert, 2001. "Non-agricultural earnings in peri-urban areas of Tanzania: evidence from household survey data," Food Policy, Elsevier, vol. 26(4), pages 385-403, August.
- Evans, David S, 1987. "Tests of Alternative Theories of Firm Growth," Journal of Political Economy, University of Chicago Press, vol. 95(4), pages 657-74, August.
- Meghana Ayyagari & Asli Demirgüç-Kunt & Vojislav Maksimovic, 2008.
"How Important Are Financing Constraints? The Role of Finance in the Business Environment,"
World Bank Economic Review,
World Bank Group, vol. 22(3), pages 483-516, November.
- Ayyagari, Meghana & Demirguc-Kunt, Asli & Maksimovic, Vojislav, 2006. "How important are financing constraints ? The role of finance in the business environment," Policy Research Working Paper Series 3820, The World Bank.
- Richard Duncombe & Richard Heeks, 2002. "Enterprise across the digital divide: information systems and rural microenterprise in Botswana," Journal of International Development, John Wiley & Sons, Ltd., vol. 14(1), pages 61-74.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
If references are entirely missing, you can add them using this form.