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Self-help Groups and Income Generation in the Informal Settlements of Nairobi

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  • Eliana La Ferrara

Abstract

The aim of this paper is to understand the functioning and the scope of self-help groups in the informal settlements of urban areas as a means of generating income for poor households. It uses a unique data set collected by the author in 1999 surveying all individual group members from several informal settlements in Nairobi. It studies the individual determinants of earnings within groups and relates group composition to various indicators of group functioning. Sex, age and ethnic identity are among the most important determinants of individual reliance on group income and of access to group loans. Heterogeneity in earnings among members is shown to reduce their ability to borrow from the group as a whole but not from each other. The impact of ethnic and other forms of heterogeneity on the division of labour, choice of compensation schemes, sanctioning technology and recruitment criteria is also described. Copyright 2002, Oxford University Press.

Suggested Citation

  • Eliana La Ferrara, 2002. "Self-help Groups and Income Generation in the Informal Settlements of Nairobi," Journal of African Economies, Centre for the Study of African Economies, vol. 11(1), pages 61-89, March.
    • Handle: RePEc:oup:jafrec:v:11:y:2002:i:1:p:61-89
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    14. Kibrom A. ABAY & Bethelhem KORU & Gashaw Tadesse ABATE & Guush BERHANE, 2019. "How Should Rural Financial Cooperatives Be Best Organized? Evidence From Ethiopia," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 90(1), pages 187-215, March.
    15. Lisa D. Cook & Linguère Mously Mbaye & Janet Gerson & Anthony Simpasa, 2021. "Working Paper 358 - The Colonial Origins of Banking Crisis in Africa," Working Paper Series 2484, African Development Bank.
    16. Place, Frank & Kariuki, Gatarwa & Wangila, Justine & Kristjanson, Patricia & Makauki, Adolf & Ndubi, Jessica, 2004. "Assessing the factors underlying differences in achievements of farmer groups: methodological issues and empirical findings from the highlands of Central Kenya," Agricultural Systems, Elsevier, vol. 82(3), pages 257-272, December.
    17. Johnston, Richard & Banting, Keith & Kymlicka, Will & Soroka, Stuart, 2010. "National Identity and Support for the Welfare State," SULCIS Working Papers 2010:11, Stockholm University, Linnaeus Center for Integration Studies - SULCIS.
    18. Sara Balestri & Stefania G. Meda, 2016. "Income Generating Activities (IGAs) and women empowerment. A pilot experience from Côte d?Ivoire," DISEIS - Quaderni del Dipartimento di Economia internazionale, delle istituzioni e dello sviluppo dis1604, Università Cattolica del Sacro Cuore, Dipartimento di Economia internazionale, delle istituzioni e dello sviluppo (DISEIS).
    19. Place, Frank & Kariuki, Gatarwa & Wangila, Justine & Kristjanson, Patti & Makauki, Adolf & Ndubi, Jessica, 2002. "Assessing the factors underlying differences in group performance: methodological issues and empirical findings from the highlands of Central Kenya," CAPRi working papers 25, International Food Policy Research Institute (IFPRI).
    20. Fumagalli, Laura & Martin, Thomas, 2023. "Child labor among farm households in Mozambique and the role of reciprocal adult labor," World Development, Elsevier, vol. 161(C).
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    23. Obare, Gideon A. & Mwakubo, Samuel M. & Ouma, Emily Awuor & Mohammed, Lutta & Omiti, John M., 2004. "Social Capital and Soil Erosion Control in Agriculturally Marginal Areas of Kenya: The Case of Machakos and Taita-Taveta Districts," 2004 Inaugural Symposium, December 6-8, 2004, Nairobi, Kenya 9532, African Association of Agricultural Economists (AAAE).

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    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • P13 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Cooperative Enterprises
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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