Our dissertation provides behavioural economics literature with new theorizations of how social
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context matters a great deal in decision-making and the decision-making process itself, especially
in regions where agents display human limitations and complications. The first chapter develops a
, theory of female empowerment through access to business loans in an environment where informality
is the only affordable venue for operating a business venture. In Sub-Saharan Africa, many social
institutions, arise either from lack of access to formaI insurance mechanisms or from the imperfection
of financial markets. One such institution is the traditional sharing obligation whereby individuals
must spread their wealth around. In chapter 2 , we show that integrating such institutions into
the standard neo-Boserupian framework can improve our Understanding of the causes of poor
, agricultural performances in Sub-Saharan Africa. In chapter three, our thesis also cémtributes to
the literature on returns toeducation in Africa by using the 2001 Cameroon household survey to
estimate private rates of returns to education.
In a more precise presentation, chapter one uses the non-cooperative game theory to highlight
coordination failure that hinders the emergence of networks of female entrepreneurs necessary to
overcome patriarchal business practices that limit female entrepreneurs' access to high-productivity
informaI activities. In our model, women's entrepreneurship is assisted by microfinance institutions
(MFIs) which provide loan and training to aIl their clients. We focus on women's demand for venture
capital and choice of activity as jointlydetermined by their ability to mitigate the ,transaction
costs that limit their q,ccess to more productive business activities. In our framework; à female
entrepreneur must jointly choose the type of business activity she plans to operate informally and
its size as determined by the amount of capital borrowed from the MFI of her choice. Operating
a high-productivity informaI activity puts a higher demand on a woman to link up with other
women operating the same type of activity in order to generate collective resources necessary to
overcome obstacles created by patriarchal business practices. The more there are female entrepreneurs
operating in such a network, the more able will this network be in enhancing women's
success at operating high-productivity activities. Conse'quently, an essential feature of the environment
underlying women's entrepreneurship in the informaI economy is the complementarity of
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their respective business strategies: a female entrepreneur's decision to tap into the range of highproductivity
activities increases other female entrepreneurs' marginal gain from following suit. We
demonstrate that in absence of a mechanism for inducing coordination of women's decision tQ link
up in a such a network, the non-cooperative game these women play admits two pure-strategy
Nash-eqtiilibria: a high-income equilibrium whereall of them operate high-productivity informaI
activities, and a low-income equilibrium where they aH remain confined into low-productivity ones,
despite access to credit. We argue that co~ditioning women's access to credit ta their adoption of
high-productivity activities acts as a sufficient condition for MFIs to nurture female empowerment.
This is because such conditionality may induce the emergence of networks of female entrepreneurs
large enough to mitigate patriarchal practices that raise the costs of operatirig such activities in
the informaI economy.
In the second chapter, we develop a game-theoretic model of fertilizers use to explain poor
agricultural outcomes in Sub-Saharan Africa (hereafter referred to as SSA). In our model, agents are
smallholder farmerswho must build up their savings so as to finance the purchase of a recommended
level of fertilizers. To build up their savings, farmers in our model must draw on the proceeds from
the previous harvesting season. However, a smallholder acting in autarky may find it hard to commit
to savingfor the next growing season (sorne four to six months away), if enough other far mers do
not follow suit, because of traditional sharing obligations that put pressure on innovation-minded
individuals to part with their assets in an unproductive manner. A farmer who anticipates thismay
renege on her commitment to save, and instead partake in the tradition to share his income with
others.· The more there are other farmers who break away from this tradition by firmly committing
to saving, the higher the likelihood that a far mer who saves in autarky will be able to protect
her savings from social predation. Consequently, a farmer's decision to save rais es other farmers'
marginal gain from saving. We show that the non-cooperative game these farmers play admits two
pure-strategy Nash-equilibria: a modernization equilibrium where all of them choose to save in order
to finance the purchase of fertilizers, and a traditional equilibrium where they all elect not to save,
and thus forfeit the benefits of farming modernization. Our game-theoretic model is consistent with
the observed coexistence, in SSA, of low-fertilizer consumption with economic conditions whichneo-
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Boserupian theories identify as essential for the onset of technological innovations in agriculture--
namely poor soil fertility and market opportunities. Indeed, in our model, conditions identified
by neo-Boserupian theories as necessary and sufficient for the onset of agricultural innovation are
shown to be only necessary. To be sufficient, this set of conditions must be enlarged to include the
creation of a savings technology capable of mitigating the effects of social predation on farmer's
decision to save.
Much emphasis is placed on the need to increase the .level of hum an capital through improved
education access, to sustain high· economic growth_ in Africa. This emphasis lias given rise to
renewed Înterest in obtaining estimates of private rates of returns to education (RORE) in Africa
so as to understand the motivations a~d constraints which individuals face in their education
cost-benefit analysis and thus be in a position to inform policy makers. While there is a large
empiricalliterature on analysis of rates of returns to education, until recently, most analysis for
Africa relied on non-representative surveys. As a result, their findings cannot be generalized to
the whole population. The third chapter addresses that issue and contributes to the literature on
returns to education in Africaby using the 2001 Cameroon household survey to estimate RORE.
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We compare RORE for those who attended an education cycle with those who have graduated
from that education cycle. We also allow individuals to be endogenously selected into the informaI
sector, the formaI private sector or in the public sector. We find strong convex and high RORE
inall sectors of employment. 1nterestingly, those who did not graduate from primary school earn
no returns compared to those who never attended school. As expected, those who graduated from
an education cycle earn statistically significant .and higher returns than those who have not. We
also find higher returns to having attended vocational school when working in the informaI sector
thân elsewhere. As our estimates are robust to using population-weighted data we can therefore
argue that they hold for the whole population of Cameroon. Our results militate in favour of an
integrated education approach whereby emphasis is placed: (i) not only on school attendance but
on graduation so that more students can reach and complete university; and (ii) a scaling-up of
the education budget at all levels for the number and the quality of African university graduates
to increase.