Business incomes in rural Nicaragua: the role of household resources,location, experience and trust |
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| Authors: | Marijke D’haese Marieke De Ruijter De Wildt Ruerd Ruben |
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| Affiliation: | 1. Development Economics Group, Department of Social Sciences , Wageningen University , Hollandseweg 1, 6706KN Wageningen, and Department of Agricultural Economics, Ghent University, Belgium, the Netherlands E-mail: marijke.dhaese@wur.nl;2. The Springfield Centre for Business in Development , Mountjoy Research Centre , Durham, UK;3. Centre for International Development Issues Nijmegen , Radboud University , Nijmegen, the Netherlands |
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| Abstract: | This paper analyses the determinants of business income for rural households in Nicaragua. A sample of 1030 households was studied in order to assess the importance of material and behavioural factors that influence income from business activity. The households are involved in manufacturing, trade, services or have a mixture of businesses. They generally have a low income and asset value. Households supplement their income from wages and agricultural activities. To estimate non-farm business income per employed person we analyse the impact of resources, location, entrepreneurial experience and trust. Our results show that household resources and entrepreneurial experience are significant determinants for business income in all sectors. Trust is also important, particularly generalized trust. The contribution of other forms of trust, such as institutional trust, depends on the sector in which households participate. |
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| Keywords: | business income trust entrepreneurial experience economic development Nicaragua. |
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