IDEAS home Printed from https://ideas.repec.org/p/wop/stanec/96013.html
   My bibliography  Save this paper

Ethnicity and Markets: Supplier Manufacturing in African Manufacturing

Author

Listed:
  • Marcel Fafchamps

Abstract

First draft: April 1996 This draft: October 1996 This paper investigates the rationale for statistical discrimination and networks effects in the allocation of supplier credit. It examines the role they may play in favoring market participation and, hence, in the emergence and persistence of ethnically homogeneous business groups. We show that members of a successful business community may rationally choose not to grant trade credit to members of other communities if the latter are, on average, less experienced or if they are not part of their reputation network. Using case study data on trade credit among manufacturing firms in Kenya and Zimbabwe, we uncover evidence that blacks are disadvantaged in the attribution of supplier credit. Statistical discrimination and network effects seem to both play a role in explaining ethnic bias.

Suggested Citation

  • Marcel Fafchamps, "undated". "Ethnicity and Markets: Supplier Manufacturing in African Manufacturing," Working Papers 96013, Stanford University, Department of Economics.
  • Handle: RePEc:wop:stanec:96013
    as

    Download full text from publisher

    File URL: http://www.stanford.edu/~fafchamp/discrim.pdf
    Download Restriction: no

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wop:stanec:96013. 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: (Thomas Krichel). General contact details of provider: http://edirc.repec.org/data/destaus.html .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.