Ethnicity and Networks in African Trade
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Marcel Fafchamps
This paper investigates the role of ethnicity, religion, gender, 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. The model also predicts that traders who start with an ethnic or network advantage grow faster. 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. We also find some evidence that religion matters, but the effect is not due to discrimination or better networks. Ethnicity also has little effect on start-up networks and working capital but women accumulate working capital slower than men, including in Benin where women represent 80% of surveyed traders. Agricultural trade appears fairly open to all, irrespective of gender, ethnicity, or religion.
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
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Articles in the same Issue
- Contributions Article
- Suggested Subsidies are Sub-optimal Unless Combined with an Output Tax
- War or Peace
- Selective Information Provision and Special Interest Influence: The Case of Trade Policy
- Price Discrimination via Proprietary Aftermarkets
- The Spite Motive and Equilibrium Behavior in Auctions
- Optimal Liability for Libel
- Aggregation of Non Stationary Demand Systems
- The Savings Impact of College Financial Aid
- A Theory of Utilization Review
- Cigarette Demand, Structural Change, and Advertising Bans: International Evidence, 1970-1995
- Piracy and the Legitimate Demand for Recorded Music
- Oligopoly Deregulation and the Taxation of Commodities
- Forming Voting Blocs and Coalitions as a Prisoner's Dilemma: A Possible Theoretical Explanation for Political Instability
- Ethnicity and Networks in African Trade
- Endogenous Preferential Trade Agreements: An Empirical Analysis
