Trade Associations, Customary Social Networks, and Female Microentrepreneurs in Ghana

Focusing on the tailoring and cosmetology trades in Ghana, this study aims to estimate the private returns to trade association membership for women and identify how these benefits differ for those connected outside the trade association. 

Craft-specific trade associations are ubiquitous among informal small-scale enterprises in much of Sub-Saharan Africa. They offer, at the very least, a formalization of social networks linking entrepreneurs within a craft and market, and to some extent throughout the country. Like modern industry commerce associations in rich countries, these groups offer a public face to the craft, provide training and guidelines, and attempt to self-regulate members. Their scope and function, however, reflect the informal nature of the associated businesses and the information-poor environments in which they operate.

The proposed study seeks to experimentally estimate the private returns to trade association membership among women in the two most-common female-dominated trades in Ghana, tailoring/dressmaking and hairdressing/cosmetology. Further, the dataset will allow for non-experimental characterization of the benefits of trade associations, including information exchange, access to resources through government agencies and NGOs, customer referrals, and collaboration over supply chain relationships. A social learning and information dispersion intervention will overlay the broader trade association study and allow the researchers to answer the following questions:

  • To what extent does membership in a trade association benefit small-scale female businesses in Ghana, and through which channels?
  • How do these benefits differ for those who are well-connected outside the trade association?
  • How do non-rival business resources and information work their way through a social network? ‚Äč