Is the Informal Sector Constrained from the Demand Side? Evidence for Six West African Capitals

Marcus Böhme and Rainer Thiele

World Development, 2012, vol. 40, issue 7, 1369-1381

Abstract: Employing a unique dataset that covers households from six West African capitals, this paper provides new evidence on the demand for informal sector products and services. We first investigate whether demand linkages exist between formal and informal products and distribution channels. In a second step, we estimate demand elasticities based on Engel curves. We find strong demand-side linkages between the formal and informal sector, with the exception that informal goods are hardly bought through formal distribution channels. The estimated demand elasticities tend to show that rising incomes are associated with a lower propensity to consume informal sector goods and to use informal distribution channels.

Keywords: informal sector; formal–informal linkages; Engel curve estimates; Africa; West African capitals (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (8)

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Related works:
Working Paper: Is the Informal Sector Constrained from the Demand Side? Evidence for Six West African Capitals (2011)
Working Paper: Is the Informal Sector Constrained from the Demand Side? Evidence for Six West African Capitals (2011)
Working Paper: Is the informal sector constrained from the demand side? Evidence for six West African capitals (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:40:y:2012:i:7:p:1369-1381

DOI: 10.1016/j.worlddev.2011.12.005

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