Integration of informal economic cross-border networks in West Africa

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by Olivier Walther …

by Olivier Walther
Centre for Population, Poverty and Public Policy Studies, Luxembourg, 2nd Working Group meeting, West African Futures: settlement, market and food security, 27-28 October 2011.

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  • 1. We s t A f r i c a n F u t u re s , O E C D Pa r i s , 2 7 - 2 8 / 1 0 / 2 0 1 1 Integration of informal economiccross-border networks in West Africa Olivier Wa lther Centre for Populati on, Pover ty and Public Policy Studies Luxe m bourg
  • 2. CROSSTRADE OECD 2011 2Cross-border networks in West AfricaNetworks are increasingly attracting attention • Historical roots (Howard and Shain 2005) • Geographic extension (Grégoire 2003) • Social embeddedness (Meagher 2010)Both the historical, spatial and the political science perspectives have considered networks in rather metaphorical and/or qualitative termsThe CROSSTRADE project will go one step further by considering networks as an analytical conceptFocus on border markets = where integration takes place
  • 3. CROSSTRADE OECD 2011 3Border markets in West Africa Border markets and potential functional regions in West Africa. Source: CROSSTRADE 2011
  • 4. CROSSTRADE OECD 2011 4Border markets in West Africa (2) Border markets in West Africa. Source: CROSSTRADE 2011
  • 5. CROSSTRADE OECD 2011 5A combination of several scales• Border markets are central places for both producers and consumers at the local scale• They provide business opportunities to small traders who exploit border differentials between twin cities• Offer a particularly favourable location for larger merchants willing to develop transnational routes
  • 6. CROSSTRADE OECD 2011 6Social Network Analysis Cross-border networks. Source: MetroNet 2011
  • 7. CROSSTRADE OECD 2011 7Social Network Analysis 2• Relational theories of social interacti o n and analytica l tools d evelop ed b y social network analysis (SNA)• An interest in g op p ortu ni ty to d iscuss a series of issues related to cross - b ord er trad e network s Brokerage roles. Adapted from Gould and Fernandez 1989
  • 8. CROSSTRADE OECD 2011 8New research questionsWhat is the soci a l struct u re of cros s - b or de r informa l networ k s ? T he success of cros s -b o rd e r network s results from their ab ility to comb ine a stron g emb ed d ed ness with b rokerag e tiesWhat is the spec if i c i ty of border markets ? B ord er markets offer a p rime locati o n for b rokersWhat are the relati on s h i p s betwee n trader s and publi c instit ut i on s in border areas ? Trad ers seek to streng then their relation sh ip s with p olit i cal actor s , or to eng ag e in p oli ti c s , in ord er to d evelop their cross - b o rd er business
  • 9. CROSSTRADE OECD 2011 9Q1. The structural position of traders• Networks founded on kinship, ethnic, and religious ties, help solve the technical problems of trade• Embedded ties reduce risk, pool complementary skills, improve access to new markets, and safeguard property rightsBut...• A strong degree of embeddedness can also have disadvantages• Trade networks have taken on a global dimension and traders have developed a more universal entrepreneurial culture
  • 10. CROSSTRADE OECD 2011 10Q1. The structural position of traders (2)• Hypothesis: economic actors will combine strong embeddedness within the social group with an extensive capability to build brokerage ties beyond the group success embeddedness SNA provides evidence of an agent’s brokerage or embeddedness by measuring different social network indexes (in- and out-degree centrality, betweenness, density, transitivity, reciprocity and brokerage)
  • 11. CROSSTRADE OECD 2011 11Q2. The specificity of border markets•Border markets play an intermediary role between differentnationally organised business networks Business networks and border markets in a cross-border environment. Source: Walther 2011
  • 12. CROSSTRADE OECD 2011 12Q2. The specificity of border markets (2)•Hypothesis: border markets can be considered as a primelocation for brokers connecting foreign domestic networks•SNA can help to provide an original measure of theimportance of urban markets•The centrality of cities does not correspond to the usualadministrative or population hierarchies. I t is linked to thepresence of economic agents
  • 13. CROSSTRADE OECD 2011 13Q3. Traders and local institutions Traders seek to strengthen their relationships withinstitutional actors, or to engage themselves in localinstitutions, in order:1)to influence political decisions or perceptions in theirfavour;2)to have better access to political resources they need inorder to secure or develop their business;Traders will tend to prefer maintaining some borderdifferentials
  • 14. CROSSTRADE OECD 2011 14Conclusion• Formal social network analysis could be used to betterunderstand cross-border economic activities• Analyze simultaneously the social role of economic actorsand their spatiality• SNA can hardly explain the intensity of ties and theevolution of the network without referring to morequalitative data SNA approach to trade should be complemented withother approaches, in particular trader biographies
  • 15. CROSSTRADE OECD 2011 15Related publications• Walther O. Traders, agricultural entrepreneurs and the development of cross -border regions in West Africa. Entrepreneurship and Regional Development (forthcoming).• Retaillé D, Walther O. 2011. Spaces of uncertainty: A model of mobile space in the Sahel. Singapore Journal of Tropical Geography 32(1): 85-101.• Walther O. 2009. A mobile idea of space. Traders, patrons and the cross-border economy in Sahelian Africa. Journal of Borderlands Studies 24: 34-46.For more information: http://afrilux.ceps.lu