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Ethnicity and Networks in African Trade

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  • Marcel Fafchamps

    (Centre for the Study of African Economies)

Abstract

This paper investigates the role of ethnicity and networks in domestic agricultural trade in Africa. Using a theoretical model of self- disciplining markets, we begin by demonstrating that statistical discrimination and networks can generate similar patterns of ethnic concentration. We then test these ideas using original survey data collected in Benin, Malawi and Madagascar. We find no evidence that members of a particular sex or ethnic group are more easily trusted by suppliers and trust clients more easily. In contrast, network effects have a strong and systematic effect on trust and information sharing. Women accumulate working capital slower than men, including in Benin where women represent 80% of surveyed traders.This does not suggest the presence of discrimination. Agricultural trade appears open to all, irrespective of gender, ethnicity, or religion.

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File URL: http://128.118.178.162/eps/dev/papers/0409/0409022.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Development and Comp Systems with number 0409022.

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Length: 53 pages
Date of creation: 22 Sep 2004
Date of revision:
Handle: RePEc:wpa:wuwpdc:0409022

Note: Type of Document - pdf; pages: 53
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Web page: http://128.118.178.162

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Cited by:
  1. Steven N. Durlauf & Marcel Fafchamps, 2004. "Social Capital," NBER Working Papers 10485, National Bureau of Economic Research, Inc.
    • Durlauf, Steven N. & Fafchamps, Marcel, 2005. "Social Capital," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 26, pages 1639-1699 Elsevier.
  2. Margherita Comola, 2010. "The network structure of mutual support links: Evidence from rural Tanzania," Working Papers halshs-00585968, HAL.
  3. Baliamoune-Lutz, Mina, 2011. "Trust-based social capital, institutions, and development," The Journal of Socio-Economics, Elsevier, vol. 40(4), pages 335-346, August.
  4. Mujawamariya, Gaudiose & Burger, Kees & D'Haese, Marijke F.C., 2012. "Behaviour and performance of traders in the gum arabic supply chain in Senegal: Investigating oligopsonistic myths," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126236, International Association of Agricultural Economists.
  5. Masakure, Oliver & Cranfield, John & Henson, Spencer, 2008. "The Financial Performance of Non-farm Microenterprises in Ghana," World Development, Elsevier, vol. 36(12), pages 2733-2762, December.
  6. Abiola Babajide Ph.D, 2012. "Effects of Microfinance on Micro and Small Enterprises (MSEs) Growth in Nigeria," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 2(3), pages 463-477, July.

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