RESEARCH PAPERS WE LIKE:

chrisblattman.com

Unwilling Entrepreneurs

A common sensical but useful new paper by Nagler and Naude, on how many if not most African households make their money. Descriptive analysis is underrated.

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.

Democratic Societies do not realise democracy's true value.

By Gary Mullen 
@HandcraftedUK

Do you live in a country where you are permitted to vote for your country's leader during an election? Do you often complain about things that are happening in your country and voice these opinions to friends? And, do you rely upon newspapers to keep you updated on the goings-on in the world? If you answered yes to these questions then, chances are, you are living in a democratic society. Although, do you take this for granted?

Take the elections for example. Do you vote during elections? If so, I can guarantee you'll know someone who doesn't. If everyone in the country did this then that would be an instant end to the democracy! Take a look at societies where citizens play no part in selecting their leader or, any elections that are held are rigged. Do you think that, given the chance, these people would pass on the idea of a fair election being held? Of course not! One of the main principles of any democratic society is for the people to raise their voice and hold their leaders accountable. Without this the voice is lost and the democracy is at risk of being lost altogether. 

The same can be said for the freedom to express your opinions to others. How often have you complained about Government policies to friends? If so you're in a very fortunate position. In some societies expressing a unique opinion can result in imprisonment or even death. So, next time you complain about how hard your life is, spare a thought for those who wouldn't even feel safe to complain in the first place!

The freedom of the press is very powerful in a democratic society. Sometimes considered more powerful than the politicians, the newspapers have the freedom to air their opinions and objectives to the policies made by Governments. Not surprisingly, this is not the case in many places in the world. In some countries, the newspapers are state owned and do not have the luxury of expressing a non-biased opinion. There, the people read what the Government want them to hear and, to a great extent, this is used as a method of controlling them.

So, do YOU take living in a democracy for granted? Perhaps if you do, it might be best for you to use your freedom and rights to their full advantage as not everyone is so lucky.