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Non-farm enterprises in rural Africa : new empirical evidence (Inglês)

Although non-farm enterprises are ubiquitous in rural Sub-Saharan Africa, little is yet known about them. The motivation for households to operate enterprises, how productive they are, and why they exit the market are neglected questions. Drawing on the Living Standards Measurement Study -- Integrated Surveys on Agriculture and using discrete choice, selection model and panel data estimators, this paper provide answers using data from Ethiopia, Niger, Nigeria, Malawi, Tanzania, and Uganda. The necessity to cope following shocks, seasonality in agriculture, and household size can push rural households into operating a non-farm enterprise. Households are also pulled into entrepreneurship to exploit opportunities. Access to credit and markets, household wealth, and the education and age of the household head are positively associated with the likelihood of operating an enterprise. The characteristics are also associated with the type of business activity a household operates. Rural and female-headed enterprises and enterprises with young enterprise owners are less productive than urban and male-owned enterprises and enterprises with older owners. Shocks have a negative association with enterprise operation and productivity and a large share of rural enterprises does not operate continuously over a year. Enterprises cease operations because of low profits, a lack of finance, or the effects of idiosyncratic shocks. Overall the findings are indicative that rural enterprises are "small businesses in a big continent" where large distances, rural isolation, low population density, and farming risks limit productivity and growth.

Detalhes

  • Autor

    Nagler,Paula, Naude, Wim

  • Data do documento

    2014/10/01

  • TIpo de documento

    Documento de trabalho sobre pesquisa de políticas

  • No. do relatório

    WPS7066

  • Nº do volume

    1

  • Total Volume(s)

    1

  • País

    Níger,

    Malaui,

    Nigéria,

    Tanzânia,

    Uganda,

    Etiópia,

  • Região

    África,

  • Data de divulgação

    2014/10/01

  • Disclosure Status

    Disclosed

  • Nome do documento

    Non-farm enterprises in rural Africa : new empirical evidence

  • Palavras-chave

    labor productivity;enterprise operation;rural enterprise;number of adults;individual characteristic;female labor market participation;food and agriculture organization;population center;agricultural household model;panel data analysis;Entrepreneurship;household level;professional service;household head;rural area;business environment;household characteristic;productive enterprise;term of productivity;low population density;health and nutrition;total factor productivity;lack of finance;lack of knowledge;labor force work;share of income;Escape from poverty;barrier to entry;quality employment;number of workers;exit of enterprise;informal labor market;rural labor market;lack of education;quality of employment;rates of return;standard error;shock variable;occupational choice;household income;household enterprise;food shortage;rural entrepreneurship;marital status;nonfarm enterprise;regression results;urban enterprise;summary statistic;idiosyncratic shock;household weight;empirical evidence;knowledge gap;probit regression;firm size;selection model;consumption decision;data availability;household wealth;age category;family ties;liquidity constraint;urban one;farming practice;survey data;informal business;urban africa;middle age;informal sector;literature review;descriptive statistic;production function;social network;credit market;informal enterprise;liquid asset;high probability;urban household;market access;wage employment;rural isolation;economic geography;pull factor;manufacturing enterprise;surplus labor;trade sale;community questionnaire;individual level;production decision;household questionnaire;individual entrepreneur;Social Protection;

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