A profile of non-farm household enterprises in Sub-Saharan Africa

Paula Nagler

Research output: Working paperProfessional

Abstract

This paper provides a comprehensive descriptive profile of non-farm
household enterprises in ten Sub-Saharan African countries,
disaggregated by the households' consumption quintiles. Various
enterprise-related aspects are covered, such as the share of households
that operate an enterprise, the motivation to start a business venture,
and various owner and enterprise characteristics. The figures show that
household enterprises are more prevalent among wealthier households,
although push factors overall dominate as entry motive. Enterprises in
lower quintiles are more often operated by owners with less education,
and in most countries female owners are more frequently found among
poorer households. The enterprises themselves are characterised by a
small size, generally solo entrepreneurship, which only marginally
increases along wealth levels. Poorer households operate more seasonal
types of businesses, which employ rarely any external labour, and which
contribute less to total household income compared to wealthier
households. While business profits grow along the welfare quintiles,
profits show a big jump from the fourth to the top quintile. Finally,
poor entrepreneurial households are considerably more often located in
rural than in urban areas. Based on these findings, this paper suggests
a set of policy recommendations that include expanding the access to and
availability of finance, education, and infrastructure, and introducing
gender-sensitive entrepreneurial policies.
Original languageEnglish
PublisherUNU-MERIT working papers
Volume48
Publication statusPublished - 23 Nov 2017

JEL classifications

  • j43 - Agricultural Labor Markets
  • l26 - Entrepreneurship
  • o55 - Economywide Country Studies: Africa
  • q12 - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

Keywords

  • Consumption
  • consumption quintiles
  • household
  • enterprises
  • Informal sector
  • Self-employment
  • sub-Saharan Africa

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