Robert J. Rolfe

The Viability Of Informal Microenterprise In South Africa

This paper analyzes entrepreneurs in South Africas informal sector. The aim is to determine the extent to which African informal retail trade spawns viable enterprises. To assess the prospects for South Africas informal retail sector, we obtained questionnaires from owners of small-scale establishments in a random sample taken throughout the country in 2007. Owners income and sales data provided a basis for investigating viability. Regression analysis tests hypotheses identified as crucial to higher income and sales, including startup capital, size, male/female ownership, business training and the proximity to shopping centers. Also tested is the influence of urbanization externalities on sales and owners income. Initial capital and positive urban externalities have a strong influence on the ability to generate a sustainable livelihood for informal entrepreneurs. After controlling for startup capital, location and other factors, it appears women entrepreneurs face distinct difficulties in generating a viable income through informal retail trade.

Attracting foreign investment through privatization: The Zambian experience

ABSTRACT Privatization serves as a potential source of foreign direct investment in Africa. During the Chiluba era (1991–2001), Zambia conducted one of Africas most sweeping privatization programs. Accordingly, direct investment swelled with the sale of state enterprises. This paper explores foreign and domestic ownership patterns following investor purchases of Zambian state-owned assets. Previous foreign owners of mining and manufacturing companies represent the principal sources of foreign capital received through privatization-the only real exceptions being expansions by South African firms. A difference of means test conducted on all known privatization cases reveals that foreign investors (outside South Africa) are more export-oriented than domestic investors and also buy higher-priced assets. South African investors, heavily concentrated in retail activities, are more likelyto have been involved in competitive acquisitions. Despite increased foreign investment during the 1990s, however, the economy has stagnated. Having sold most of its state assets Zambia, like other sub-Saharan Africa countries, must endeavor to attract investment through other channels.

Regional Incentives and Industrial Location in Puerto Rico

This study uses nested logit to estimate the influence of industrial incentives on the location of manufacturing plants in Puerto Rico. Puerto Rican laws grant generous tax exemptions and provide other incentives for investments in less developed, peripheral regions of the island. Focusing on Puerto Rico allowed us to isolate and test location factors in a closed environment where 76 municipalities received a development zone designation and competed directly against one another for new plants. Simulations indicated that the regional incentive policy reallocated relatively few of the greenfield investments from the congested core to the periphery of the island.

Patterns and Determinants of Intra-African Foreign Direct Investment

Since the early 2000s, much has been written about surging investment by Asian-based businesses in Africa (Ajayi, 2006; Brautigam, 2009; Michel and Beuret, 2009). Conferences have been organized, institutes founded, and numerous articles have addressed Asian foreign direct investment (FDI), with special attention given to the spread of Chinese capital across the continent (Brautigam, 2014). However, there is an equally significant phenomenon that has yet to receive much consideration: African firms are actively investing as well. Intra-African foreign direct investment is growing faster than FDI from any other region and has increased over 30 percent since 2007 (Ernst and Young, 2013). In the decade from 2003 through 2013, there were actually more greenfield investments from African companies (994) than there were from Asian companies (959) (fDi Markets, 2014).

Microenterprise, Multinational Business Support, and Poverty Alleviation in South Africa's Informal Economy

The authors examine corporate programs that support microenterprise development in Africa. Specifically, the analysis assesses the extent to which local income and sales are affected by Coca-Colas initiatives to assist South Africas microenterprise in the retail trade sector. To quantify the impact, questionnaires were obtained from owners of small-scale retail establishments in the countrys vast informal economy. Regression analysis is performed on key variables from the survey, testing hypotheses advanced to explain the size of an owners income and sales. In addition to business development support, the explanatory variables include startup capital, size, and male/female ownership. It appears that business development support has a positive effect on lifting income and reducing poverty for microenterprise owners, after controlling for other influences.

Institutional change and firms' entry mode in Africa

Institutional environment is a critical consideration for multinational corporations (MNCs) when entering emerging countries. We argue that institutional change affects MNCs’ choices between acquis...