Policy implications of the spatial and structural relationships of the informal and formal business sectors in urban Nigeria : the case of Enugu (1990-2010)

Onyebueke, Victor Udemezue (2013-03)

Thesis (PhD)--Stellenbosch University, 2013.

Thesis

ENGLISH ABSTRACT: The 21st Century is witnessing the concurrence of neoliberal globalisation and widespread informalisation. To this extent, the informal sector or economy is perceived as a permanent ‘feature of modern capitalist development’ (Chen 2007: 2). Its expansion, particularly in developing countries, has far reaching implications for employment generation, occupational or livelihood diversification, urban form dynamics, urban planning, as well as the general economic outcome. The historical evolutionary truth of the informal origin of most businesses coupled with the reality of informal-formal sector continuum gives credence to the critical imperative of multi-path development regime that does not consider the informal sector as a dead end. Consequently, the research explored the policy implications of the spatial and structural relationships between the informal and formal business sectors in urban Nigeria. The study region is viewed from the prism of Enugu, the major administrative centre in the southeast region of the country. Here, spatial-structural causalities at the city level are conjectured as surrogates of the globalisation-induced transformations occurring in the country from 1990 to 2010 (Andranovich & Riposa 1993). The research sought to: one, examine the extent relationships between the distribution structures of two economic segments in the city; and two, explore the changes in inter-sectoral linkages and the urban business landscape mediated by the global-local economic changes. To guide the study, two research hypotheses were formulated, viz.: (1) to prove whether or not some significant spatial/structural relationships exist between the distribution of informal and formal business units in the study area; and (2) to verify if the observed changes in the spatial and structural relationships between the two segments are accounted for by the same sets of physical, economic, and socio-cultural variables. The study made use of primary and secondary data, which were collected via mixed research methods. The proportional stratified sampling was used where necessary. The primary data were collected through casual observation/recognisance, photographic and questionnaire surveys, and semi-structured personal interviews; while the secondary data were sourced from literature review, maps and databanks of local governments and Federal Inland Revenue Service (FIRS). The data analytical procedure involved data reduction and hypotheses testing. The former technique consists of sectoral aggregation (the segmentation by coherent attribute-sectors) and spatial aggregation (translation from quantitative into spatial dimensions) (Wang & Vom Hofe 2007), while the latter required the use of Spatial Statistics Analysis toolsets of the ArGIS software and the Principal Component Analysis (PCA) of the SPSS package. The Spatial Statistics Analysis (the Spatial Autocorrelation or Moran’s I index) and PCA results permitted the rejection of the two null hypotheses respectively. The Moran’s I index is 0.16 with a Z score of 159.78 at a significant level of .01 and critical value of 2.58, revealing a highly clustered spatial association (or dependence) between the informal and formal business distribution in the study area. Based on the eigenvalues of 10 selected variables, the PCA extracted three major determinants of the observed spatial-structural causalities, namely: socio-economic and cultural traits or business ethos, client base and market control, and physical environment/business transaction mode. The findings challenges the received model of Nigeria retail hierarchy, and among the key recommendations for guaranteeing stronger informal-formal sector linkages that are generative of sustainable endogenous development are: (i) the reinstatement of the import substitution programme; (ii) implementation of the innovative Cluster Concept of Industrial Development Strategy (CCIDS) of 2007; and (iii) adoption of urban planning standards that are pro-informal sector.

AFRIKAANSE OPSOMMING: In die 21ste eeubeleefonsgelyktydigneoliberaleglobalisasie en wydverspreideinformalisasie. Samelopendhiermee word die informelesektorvandieekonomiegesien as ’n “permanentekenmerk van die kapitalistieseontwikkeling.” (Chen 2007: 2). Die uitbreidingdaarvan, veral in ontwikkelendelande, het verreikendeimplikasies vir die skepping van werksgeleenthede, die diversifikasie van loopbaan- en broodwinnings-moontlikhede, stedelikevorms, stedelikebeplanning, asookalgemeneekonomieseuitkomstes. Die historieseevolusionêrewaarheidoor die oorsprong van die meestebesighede, tesame met die realiteit van die informelesektorkontinuum, verleengeloofwaardigheidaandie kritiesebelangrikheid van die multi-pad ontwikkelingraamwerkwaarbinne die informelesektorniegesien word as ’n doodloopstraatnie. Gevolglik het die navorser die beleidsimplikasies van die ruimtelike- en struktureleverhoudingtussen die informele en die formele sake-sektors in stedelikeNigeriëondersoek. Die studiegebied word besigtigvanuit die prisma van Enugu, die hoof administratiewesentrum van die suidelikestreek van Nigerië. Hier word ruimetelik-struktureleoorsaaklikhedegebruik as maatstawwe vir die transformasieswatdeurglobalisasieveroorsaak is, en wattussen 1990 en 2010 in die land plaasgvind het (Andranovich&Riposa 1993). Daar is in die navorsinggepoog om eerstens die omvang van verwantskappetussen die verspreidingstrukture van die twee ekonomiesesegmente van die stad vas te stel, en tweedens, om die veranderings in inter-sektorieseskakels en die stedelike sake landskapwatdeur die globaale-plaaslikeekonomieseveranderingsbemiddel is, te bestudeer. Twee navorsinghipoteses is geformaliseer, naamlik (1) om te bewys of daarbetekenisvolleruimtelike/struktureleverwantskappebestaantussen die verspreiding van informele en formeleeenhede in die studie- gebied, en (2) om te bevestig of die veranderings in die ruimtelike en struktureleverwantskappetussen die twee besigheidsegmentetoegeskryfkan word aandieselfdestelfisiese, ekonomiese en sosio-kultureleveranderlikes. In die studie is daargebruikgemaak van primêre en sekondêre data watdeurmiddel van gemengdenavorsingmetodesversamel is. Die proporsioneelgestratifiseerdesteekproefmetode is, waarnodig, gebruik. Die primêre data is deurterloopseobservasie, fotografiese- en vraelysopnames, en semi-gestruktureerde persoonlike onderhoudeversamel, terwyl die sekondêre data verkry is uit ’n oorsig van die letterkunde, landkaarte, en die databanke van plaaslikeowerhede en die binnelandsebelastingsdiens. (FIRS). Die data ontledingsproses het data reduksie en hipotesetoetsingingesluit. Dievorigetegniekbestaanuitsektorieseaggregasie (segmentasiedeursamehandeattribuutsektore) en ruimtelikeaggregasie (oorgesitvanafkwantitatiewenaruimtelikedimensies) (Wang & VomHofe 2007). Vir die laasgenoemde was dit nodig om Spatial Statistics Analysis gereedskapstel van die ArGISsagteware en die Principal Component Analysis (PCA) van die SPSS paket te gebruik. The Spatial Statistics Analysis (die Spatial Autocorrelation of Moran se I indeks) en die PCA resultatehet die verwerping van die twee nulhipotesesmoontlikgemaak. Moran se I indeks is 0.16 met ’n Z telling van 159.78 teen ’n betekenisvollevlak van .01 en ’n kritiesewaarde van 2.58, wat ’n hoogsgetrosderuimetlikeassosiasieaantoon, of dat die verspreiding van die informele en formelebesighede in die studiegebiednabymekaargeleë en afhanklik is van mekaar. Gegrond op die eigenwaardes van die 10 gekoseveranderlikes, is daardeur die PCA bepaalwat die drie hoof ruimtelik-strukturelekousaliteite is. Dit is sosio-ekonomiese en kulturelekenmerke, kliente basis en markbeheer, en fisieseomgewing/sake transaksie modus. Die bevindingeverskil van die ontvangdemodel van die Nigeriesehierargie. Om sterkerinformele-formeleskakelswatvolhoubareendogeneontwikkelingwaarborg, te genereer, word die volgendeaanbevelingsgemaak: (i) die invoerplaasvervangings-program moetingestel word, (ii) die Cluster Concept of Industrial Development Strategy (CCIDS) van 2007 moet implementer word; en (iii) stedelikebeplanningstandaardewat pro-informelesektor is, moet aanvaar word.

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