Ethnic Ties in Trade Relationships and the Impact on Economic Performance: The Case of Small-Scale Producers in the Handloom Sector in Ethiopia

Merima Abdella Ali (1) , Jack Peerlings (2)

1 Agricultural Economics and Rural Policy Group
2 Agricultural Economics and Rural Policy Group

This paper analyzes the importance of ethnic ties in trade relationships of small-scale producers in the handloom sector in Ethiopia using both a non parametric and a parametric statistical method. It is shown how various socio-economic characteristics of producers lead to ethnic ties with traders. It is also shown that ethnic ties affect the performance of producers negatively. Apparently the positive effect of ethnic ties, through the reduction of transaction costs arising from market imperfections, does not outweigh the negative effects of closed social networks.

Mots clés: Social Sciences & Humanities

Domaines: Sciences de l'Homme et Société

Merima Abdella Ali, Jack Peerlings. Ethnic Ties in Trade Relationships and the Impact on Economic Performance: The Case of Small-Scale Producers in the Handloom Sector in Ethiopia. The Journal of Development Studies, 2011, pp.1. ⟨10.1080/00220388.2011.579110⟩. ⟨hal-00722237⟩