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Unlocking Productive Entrepreneurship In Africa???S Least Developed Countries

Author

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  • Zuzana Brixiova
Abstract
In Africa???s least developed countries (LDCs), escape from poverty and convergence to living standards of more advanced economies depends critically on structural transformation and the emergence of productive entrepreneurship that would accelerate growth and job creation. So far, however, subsistence agriculture has been the main source of employment in these countries, while a dynamic private sector in industry or high value-added services has remained elusive. Utilizing the flow approach to labor markets, this paper complements the empirical literature and numerous surveys on small and medium enterprise (SME) constraints and develops a theoretical framework that examines the main obstacles to entrepreneurship in Africa???s LDCs. The paper posits that given the persistent frictions in product and labor markets as well as skill shortages that characterize these economies, development of productive entrepreneurship cannot be left to markets alone. The policy analysis suggests that the state has an important role to play. Well-targeted government interventions including training of potential entrepreneurs and workers can help establish more modern and highly productive SME clusters that Africa???s LDCs need.

Suggested Citation

  • Zuzana Brixiova, 2010. "Unlocking Productive Entrepreneurship In Africa???S Least Developed Countries," William Davidson Institute Working Papers Series wp990, William Davidson Institute at the University of Michigan.
    • Handle: RePEc:wdi:papers:2010-990
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    References listed on IDEAS

    as
    1. Mina Baliamoune-Lutz, 2007. "Entrepreneurship, Reforms, and Development: Empirical Evidence," ICER Working Papers 38-2007, ICER - International Centre for Economic Research.
    2. Mina Baliamoune-Lutz, 2009. "Entrepreneurship and Reforms in Developing Countries," WIDER Working Paper Series RP2009-04, World Institute for Development Economic Research (UNU-WIDER).
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Michael Adusei, 2016. "Does Entrepreneurship Promote Economic Growth in Africa?," African Development Review, African Development Bank, vol. 28(2), pages 201-214, June.
    2. Zuzana Brixiova & Thierry Kangoye, 2014. "Youth Unemployment in Africa: New Evidence and Policies from Swaziland," AIEL Series in Labour Economics, in: Dario Sciulli & Miguel Ángel Malo (ed.), Disadvantaged Workers, edition 1, chapter 9, pages 181-202, AIEL - Associazione Italiana Economisti del Lavoro.
    3. Léonce Ndikumana & Mina Baliamoune-Lutz & Zuzana Brixiová, 2011. "Credit Constraints And Productive Entrepreneurship In Africa," Working Papers wp276, Political Economy Research Institute, University of Massachusetts at Amherst.
    4. Frank Iyekoretin Ogbeide & Oluwafemi Mathew Adeboje, 2020. "Effects of financial reform on business entry in sub‐Saharan African countries: Do resource dependence and institutional quality matter?," African Development Review, African Development Bank, vol. 32(2), pages 188-199, June.
    5. Constance Gunhidzirai & Pius T Tanga, 2017. "Informal Entrepreneurship as a Poverty Alleviation Mechanism in Zimbabwe: Challenges and Prospects," Journal of Economics and Behavioral Studies, AMH International, vol. 9(4), pages 132-143.
    6. T. Gries & R. Grundmann & I. Palnau & M. Redlin, 2018. "Technology diffusion, international integration and participation in developing economies - a review of major concepts and findings," International Economics and Economic Policy, Springer, vol. 15(1), pages 215-253, January.
    7. Zuzana Brixiova, 2013. "Modeling productive entrepreneurship in developing countries," Small Business Economics, Springer, vol. 41(1), pages 183-194, June.
    8. Mina Baliamoune-Lutz & Zuzana Brixiová & Léonce Ndikumana, 2011. "Credit Constraints & Productive Entrepreneurship in Africa," William Davidson Institute Working Papers Series wp1025, William Davidson Institute at the University of Michigan.

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    More about this item

    Keywords

    Entrepreneurship; institutions and policies; Africa; LDCs; search model;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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