African Small and Medium Enterprises, Networks, and Manufacturing Performance

This paper examines the role of private support institutions in determining small and medium enterprise (SME) growth and performance in Sub-Saharan Africa (SSA). It finds that SMEs in SSA get around market failures and lack of formal institutions by creating private governance systems in the form of...

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Main Authors:	Biggs, Tyler, Shah, Manju Kedia
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ADVERSE EFFECTS AGRICULTURE ASSETS ASYMMETRIC INFORMATION BANK LOANS CAPITAL FLIGHT COMMUNITIES COMPARATIVE ADVANTAGES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMERS CONTRACT ENFORCEMENT COST OF CAPITAL DEBT DECENTRALIZED MARKETS DEVELOPMENT AGENCIES DISCOUNT RATE DISCOUNTED VALUE ECONOMIC CONDITIONS ECONOMIC FUNCTIONS EMPLOYMENT EQUITY INVESTMENTS ETHNIC GROUPS FINANCIAL MARKETS HUMAN CAPITAL INDUSTRIALIZATION INSURANCE INVENTORY LAWS MONOPOLY NETWORK EXTERNALITIES NETWORK EXTERNALITY NETWORKING NETWORKS NEW ENTRANTS OPPORTUNITY COST POSITIVE EXTERNALITIES PRODUCTION FUNCTION PRODUCTIVITY PROPERTY RIGHTS REGRESSION ANALYSIS SAVINGS SIDE EFFECTS SUB-SAHARAN AFRICA SUNK COSTS TRANSACTION COSTS VALUE ADDED WEALTH WORKING CAPITAL
Online Access:	http://documents.worldbank.org/curated/en/2006/02/6606436/african-small-medium-enterprises-networks-manufacturing-performance http://hdl.handle.net/10986/8752

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recordtype	oai_dc
spelling	okr-10986-87522021-04-23T14:02:40Z African Small and Medium Enterprises, Networks, and Manufacturing Performance Biggs, Tyler Shah, Manju Kedia ADVERSE EFFECTS AGRICULTURE ASSETS ASYMMETRIC INFORMATION BANK LOANS CAPITAL FLIGHT COMMUNITIES COMPARATIVE ADVANTAGES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMERS CONTRACT ENFORCEMENT COST OF CAPITAL DEBT DECENTRALIZED MARKETS DEVELOPMENT AGENCIES DISCOUNT RATE DISCOUNTED VALUE ECONOMIC CONDITIONS ECONOMIC FUNCTIONS EMPLOYMENT EQUITY INVESTMENTS ETHNIC GROUPS FINANCIAL MARKETS HUMAN CAPITAL INDUSTRIALIZATION INSURANCE INVENTORY LAWS MONOPOLY NETWORK EXTERNALITIES NETWORK EXTERNALITY NETWORKING NETWORKS NEW ENTRANTS OPPORTUNITY COST POSITIVE EXTERNALITIES PRODUCTION FUNCTION PRODUCTIVITY PROPERTY RIGHTS REGRESSION ANALYSIS SAVINGS SIDE EFFECTS SUB-SAHARAN AFRICA SUNK COSTS TRANSACTION COSTS VALUE ADDED WEALTH WORKING CAPITAL This paper examines the role of private support institutions in determining small and medium enterprise (SME) growth and performance in Sub-Saharan Africa (SSA). It finds that SMEs in SSA get around market failures and lack of formal institutions by creating private governance systems in the form of long-term business relationships and tight, ethnically-based, business networks. There are important links between these informal governance institutions and SME performance. Networks raise the performance of "insiders" and, in the sparse business environments of the SSA region, have attendant negative consequences for market participation of "outsiders," such as indigenous African SMEs. This is indicated through the determinants of access to supplier credit. Policy interventions will be needed to improve the platform for relation-based governance mechanisms and to address the exclusionary effects of tight networks. 2012-06-22T14:09:43Z 2012-06-22T14:09:43Z 2006-02 http://documents.worldbank.org/curated/en/2006/02/6606436/african-small-medium-enterprises-networks-manufacturing-performance http://hdl.handle.net/10986/8752 English Policy Research Working Paper; No. 3855 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Africa
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ADVERSE EFFECTS AGRICULTURE ASSETS ASYMMETRIC INFORMATION BANK LOANS CAPITAL FLIGHT COMMUNITIES COMPARATIVE ADVANTAGES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMERS CONTRACT ENFORCEMENT COST OF CAPITAL DEBT DECENTRALIZED MARKETS DEVELOPMENT AGENCIES DISCOUNT RATE DISCOUNTED VALUE ECONOMIC CONDITIONS ECONOMIC FUNCTIONS EMPLOYMENT EQUITY INVESTMENTS ETHNIC GROUPS FINANCIAL MARKETS HUMAN CAPITAL INDUSTRIALIZATION INSURANCE INVENTORY LAWS MONOPOLY NETWORK EXTERNALITIES NETWORK EXTERNALITY NETWORKING NETWORKS NEW ENTRANTS OPPORTUNITY COST POSITIVE EXTERNALITIES PRODUCTION FUNCTION PRODUCTIVITY PROPERTY RIGHTS REGRESSION ANALYSIS SAVINGS SIDE EFFECTS SUB-SAHARAN AFRICA SUNK COSTS TRANSACTION COSTS VALUE ADDED WEALTH WORKING CAPITAL
spellingShingle	ADVERSE EFFECTS AGRICULTURE ASSETS ASYMMETRIC INFORMATION BANK LOANS CAPITAL FLIGHT COMMUNITIES COMPARATIVE ADVANTAGES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMERS CONTRACT ENFORCEMENT COST OF CAPITAL DEBT DECENTRALIZED MARKETS DEVELOPMENT AGENCIES DISCOUNT RATE DISCOUNTED VALUE ECONOMIC CONDITIONS ECONOMIC FUNCTIONS EMPLOYMENT EQUITY INVESTMENTS ETHNIC GROUPS FINANCIAL MARKETS HUMAN CAPITAL INDUSTRIALIZATION INSURANCE INVENTORY LAWS MONOPOLY NETWORK EXTERNALITIES NETWORK EXTERNALITY NETWORKING NETWORKS NEW ENTRANTS OPPORTUNITY COST POSITIVE EXTERNALITIES PRODUCTION FUNCTION PRODUCTIVITY PROPERTY RIGHTS REGRESSION ANALYSIS SAVINGS SIDE EFFECTS SUB-SAHARAN AFRICA SUNK COSTS TRANSACTION COSTS VALUE ADDED WEALTH WORKING CAPITAL Biggs, Tyler Shah, Manju Kedia African Small and Medium Enterprises, Networks, and Manufacturing Performance
geographic_facet	Africa
relation	Policy Research Working Paper; No. 3855
description	This paper examines the role of private support institutions in determining small and medium enterprise (SME) growth and performance in Sub-Saharan Africa (SSA). It finds that SMEs in SSA get around market failures and lack of formal institutions by creating private governance systems in the form of long-term business relationships and tight, ethnically-based, business networks. There are important links between these informal governance institutions and SME performance. Networks raise the performance of "insiders" and, in the sparse business environments of the SSA region, have attendant negative consequences for market participation of "outsiders," such as indigenous African SMEs. This is indicated through the determinants of access to supplier credit. Policy interventions will be needed to improve the platform for relation-based governance mechanisms and to address the exclusionary effects of tight networks.
format	Publications & Research :: Policy Research Working Paper
author	Biggs, Tyler Shah, Manju Kedia
author_facet	Biggs, Tyler Shah, Manju Kedia
author_sort	Biggs, Tyler
title	African Small and Medium Enterprises, Networks, and Manufacturing Performance
title_short	African Small and Medium Enterprises, Networks, and Manufacturing Performance
title_full	African Small and Medium Enterprises, Networks, and Manufacturing Performance
title_fullStr	African Small and Medium Enterprises, Networks, and Manufacturing Performance
title_full_unstemmed	African Small and Medium Enterprises, Networks, and Manufacturing Performance
title_sort	african small and medium enterprises, networks, and manufacturing performance
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2006/02/6606436/african-small-medium-enterprises-networks-manufacturing-performance http://hdl.handle.net/10986/8752
_version_	1764405944896192512

African Small and Medium Enterprises, Networks, and Manufacturing Performance

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