Family Ceremonies as a Constraint on Informal Sector Investment: The Case of Sénégal

39 Pages Posted: 30 May 2018

See all articles by John Bennett

John Bennett

Brunel University London - Economics and Finance; Institute for the Study of Labor (IZA); University of Wales, Swansea - School of Business and Economics; Centre for Economic Policy Research (CEPR)

Stephanie Levy

London School of Economics & Political Science (LSE) - Department of International Development

Abstract

We analyze how intermittent large expenditures on family ceremonies may affect an entrepreneur's investment decision in an informal enterprise. Our hypothesis is that the barrier between family and enterprise is thin and permeable. We test this hypothesis using a survey from Sénégal that combines informal sector and household data. We estimate a measure of exposure to spending on births, weddings and funerals, and show this has a significant negative relationship with the decision to invest and the amount of investment. These results are robust to changes in specifications of the determinants of investment, controlling for both enterprise- and family-related variables.

Keywords: informality, investment behaviour, family ceremonies

JEL Classification: O17, D13, O12

Suggested Citation

Bennett, John and Levy, Stephanie, Family Ceremonies as a Constraint on Informal Sector Investment: The Case of Sénégal. IZA Discussion Paper No. 11529. Available at SSRN: https://ssrn.com/abstract=3185221

John Bennett (Contact Author)

Brunel University London - Economics and Finance ( email )

Uxbridge UB8 3PH
United Kingdom
+44 1895 816 201 (Phone)
+44 1895 203 384 (Fax)

Institute for the Study of Labor (IZA)

Schaumburg-Lippe-Str. 7 / 9
Bonn, D-53072
Germany

University of Wales, Swansea - School of Business and Economics ( email )

Singleton Park
Swansea, Wales SA2 8PP SA2 8PP
United Kingdom
+44 1792 295 168 (Phone)
+44 1792 295 872 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Stephanie Levy

London School of Economics & Political Science (LSE) - Department of International Development ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

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