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Alby, Philippe, Auriol, Emmanuelle
and Nguimkeu, Pierre
(2018)
Does Social Pressure Hinder Entrepreneurship in Africa? The Forced Mutual Help Hypothesis.
TSE Working Paper, n. 18-956, Toulouse
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Abstract
In the absence of a public safety net, wealthy Africans have the social obligation to share their re- sources with their needy relatives in the form of cash transfers and inefficient family hiring. We develop a model of entrepreneurial choice that accounts for this social redistributive constraint. We derive pre- dictions regarding employment choices, productivity, and profitability of firms ran by entrepreneurs of African versus non-African origin. Everything else equal, local firms are over-staffed and less productive than firms owned by nonlocals, which discourages local entrepreneurship. Using data from the manu- facturing sector, we illustrate the theory by structurally estimating the proportion of missing African entrepreneurs. Our estimates, which are suggestive due to the data limitation, vary between 8% and 12.6% of the formal sector workforce. Implications for the role of social protection are discussed.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Language: | English |
| Date: | September 2018 |
| Place of Publication: | Toulouse |
| Uncontrolled Keywords: | Entrepreneurship, Family Solidarity, Formal Sector, Africa |
| JEL Classification: | C51 - Model Construction and Estimation H53 - Government Expenditures and Welfare Programs H55 - Social Security and Public Pensions O14 - Industrialization; Manufacturing and Service Industries; Choice of Technology O17 - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements - Legal, Social, Economic, and Political O55 - Africa |
| Subjects: | B- ECONOMIE ET FINANCE |
| Divisions: | TSE-R (Toulouse) |
| Institution: | Toulouse Capitole University |
| Site: | UT1 |
| Date Deposited: | 28 Sep 2018 14:36 |
| Last Modified: | 02 Apr 2021 15:58 |
| OAI Identifier: | oai:tse-fr.eu:32964 |
| URI: | https://publications.ut-capitole.fr/id/eprint/26284 |
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